Determining Support And Resistance Levels

[kenny123]

Hello Mr Mihai,

You are equally right for that. I;ve started researching about support and resistance from various write-ups on the net in order to come up with my own system. Nonetheless, one might need someone to put one through.
I will be very glad to be an active participant in that Elliott wave theory.
But from what I've gathered so far, it is very possible to wake up in the morning, calculate pivot point, place limit orders eg buy above the high and sell below the low, go away and come back with profits. Am I right? I will also like to know what strategy those who send signals or make accurate forecasts use to achieve accuracy.

[nick andre]

there are so many different ways to find support & resistance.. pivots, fibs, swing highs and lows, round numbers, numbers that correspond with the aligntment of the moon and the stars...lol...

the bottom line is, you'll never have EVERY price level of support and resistance on your chart. and neither would you want to.

BUT if you pick a few ways to identify them, then identify and trade them consistently, chances are you'll do just fine. i think a good rule of thumb is, if you can clearly see it on your chart, its tradeable. chances are there are a number of other traders out there who are looking at the same price level as support and/or resistance. hence, price will react there.

just my 2 cents..

[awsl]

I am using Linear regression channels for the trend lines, pivots point for support/resistance reference. Instead of LRC, you can just plot lines like what Nadar is doing, it's pretty effective.

[dchan498]

Originally Posted by EugeneFXI

Hi there,

One way to determine Pivots without depending on the indicators is by hand - manually.

Pivot formulas are available all over the net, so you can plug them into an excel sheet and just adjust your daily highs and lows.

Pivot = ( High + Close + Low ) / 3
Resistance1 = 2 * Pivot - Low
Support1 = 2 * Pivot - High
Resistance2 = Pivot + (Resistance1 - Support1)
Support2 = Pivot - (Resistance1 - Support1)
Resistance3 = High + 2*(Pivot - Low)
Support3 = Low - 2*(High - Pivot)

Indicators don't always give the best result because some brokers use a timezone other than GMT, and the indicators depend on the high/low/close values of the Daily bars (which would be changed in this case).

Let me know if you have any questions!

Hi Eugene, how do we adjust the timezone on the FXI Pivots indicator if my broker doesn't use GMT as it's start of the day? Actually, I want to use the end of EST (NY Time) as the start of the Forex day. What's your thoughts on that? Thanks in advance!

-Dave