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Your ability to choose a trading strategy is one of extraordinary measure. It puts
you in control of making money your way.
You will not be without moves to enter trades once you create a strategy that works for you every week. Therefore, choosing one method and making it work for you is essential rather than choosing many and none work.
To make it easy for you, I'm creating a four-part series to help you choose what market structure you will trade.
What Is Market Structure?
Market Structure is what you plot on your chart to tell you where to enter and exit trades.
Market Structure gives you two options:
1. The chance to enter trades at the best price
2. The chance to exit trades in profit at the best price
When you wrap your mind around this, you'll begin to make better analyzing decisions.
These chances are beneficial to your trading decisions for you who may be the new, struggling, or advanced trader.
The struggle with Support and resistance isn't how to plot it, but what timeframes to use and where to take profits. I'm grateful to have the opportunity to teach you just how to do it.
I used to be a support and resistance trade. While I may not trade it anymore, I know of its power.
The Trading Process
Now, I'll share my step-by-step process on how I used to trade Support and Resistance. I hope you use it to your benefit to see profits in the market.
Start plotting levels on the daily timeframe.
Notate levels above the price line as resistance or below the price line as Support.
Drop down to the 4-hour timeframe and enter trades only when the price rejects the level. Don't drop down in timeframes after this. The daily and 4-hour pair well together.
Take profit is the next level depending on direction.
The stop loss is personal, so you'll have to find comfort with each pair you trade.
Risk 1 %-3% of your trading balance in the trade.
I plotted levels on AUDUSD on the daily timeframe. Your levels don't have to look like mine. Get creative with the colors, and remember, no two people's charts will look the same or have the same price point. Support and resistance levels are based on your eyes.
This strategy is not perfect. You will lose some trades, but if you swing trade it right, you can have some excellent trades in front of you. Hopefully, this will help you if this is the market structure you decide to trade.