WEBVTT 00:02.620 --> 00:07.390 In this video, we'll take a look at one of the most basic aspects of trading, and that is going to 00:07.390 --> 00:08.830 be support and resistance. 00:09.250 --> 00:13.240 So support and resistance is exactly what it sounds like. 00:13.240 --> 00:17.060 It is support for price or resistance, the price. 00:17.080 --> 00:22.050 So, for example, a place where price will drop below. 00:22.060 --> 00:30.610 So that is support there as the market continues to find buyers in this general vicinity, just as this 00:30.610 --> 00:37.630 was resistance, as the markets kept trying to break above there, but could not actually accomplish 00:37.630 --> 00:37.950 that. 00:38.620 --> 00:45.910 Now, support supported resistance tends to form at large round figures. 00:46.210 --> 00:51.100 And as a result, you can use that to your advantage. 00:51.340 --> 00:58.420 In order to do this on Trading View, you click on the line to the horizontal line tool and you just 00:58.600 --> 01:00.040 place it right on the chart. 01:00.040 --> 01:02.590 You can drag from the oval here. 01:02.950 --> 01:06.660 And this brings up something a bit interesting. 01:07.360 --> 01:15.730 So as you can see again, right, click this and go down to the settings, the coordinates. 01:15.730 --> 01:22.990 I can make it to 40 even, and most of the time you will find that price tends to respect these round 01:22.990 --> 01:23.440 numbers. 01:23.440 --> 01:30.310 Like I said, now there is an area that has been supportive, a little bit of a range here, just below 01:30.310 --> 01:30.960 240. 01:31.210 --> 01:36.160 And as we broke higher in a theory, I'm on the daily chart, we finally plunged through it and it offered 01:36.160 --> 01:37.000 resistance. 01:37.480 --> 01:39.810 You quite often see that its market memory. 01:40.180 --> 01:46.930 So what I use to illustrate this a lot of times will be the idea of a high rise. 01:46.930 --> 01:53.890 So say you've got four floors here, floor one floor to floor three or four. 01:54.430 --> 02:00.370 And if you take the stairs or the elevator up to the second floor, what was once the ceiling now becomes 02:00.370 --> 02:01.090 your floor. 02:02.060 --> 02:08.150 Just as if you drop from the fourth floor to the third floor, what was once your floor becomes the 02:08.150 --> 02:15.140 ceiling, it's kind of the same thing in technical analysis, we go ahead and draw a couple of other 02:15.140 --> 02:19.310 lines and you will see that as I draw these out. 02:21.090 --> 02:31.080 It becomes apparent that this market, Ethereum seems to like these levels right around every 40 dollars 02:31.080 --> 02:36.480 or so you can make an argument for these are areas you should be trading from. 02:37.080 --> 02:43.320 Quite often what people will do is they'll look for support or resistance in the marketplace on higher 02:43.320 --> 02:48.960 timeframes and then perhaps drill down to a lower timeframe to see how it behaves. 02:49.530 --> 02:51.670 That's getting a little ahead of where we're at now. 02:51.990 --> 02:58.640 But what this does suggest to you is that markets, in fact, are not random and they do have little 02:58.920 --> 03:02.400 road map, kind of like posting signs. 03:02.970 --> 03:10.740 You can think of it as opening up a map, seeing that there are directions, there are turns and twist 03:10.740 --> 03:11.430 in the road. 03:11.430 --> 03:12.600 Very similar here. 03:13.080 --> 03:18.720 By simply drawing these four lines, you can see how different the market suddenly looks. 03:19.590 --> 03:26.430 So, like I said, a lot of times they will tend to appear near a large round number. 03:27.410 --> 03:33.260 So you can click on a horizontal tool, a horizontal line tool, and you can drag this bubble until 03:33.260 --> 03:42.390 you find several places where price either does or doesn't go above or doesn't go below. 03:42.890 --> 03:50.060 So, for example, you can see right here, there's obviously some trouble right around the. 03:54.460 --> 03:58.300 Forty three dollars level and you can see that. 03:59.690 --> 04:05.610 As Price kept trying to get there, it kept running into a lot of issues. 04:05.900 --> 04:08.630 You can also make an argument for right around here. 04:08.840 --> 04:10.520 This would be basically. 04:14.510 --> 04:15.830 Eighty five dollars. 04:16.860 --> 04:26.130 Again, that's around, that's a big figure, you know, you can quite often go into these markets and 04:26.130 --> 04:27.710 like I said, you start to see a pattern. 04:27.720 --> 04:32.340 So, for example, let's see what 75 has to say here. 04:32.670 --> 04:37.110 And Litecoin, you can see 75 was someone important. 04:37.120 --> 04:40.200 You can see several times where buyers and sellers came in. 04:41.010 --> 04:42.360 There was resistance there. 04:42.360 --> 04:43.440 There was support there. 04:43.740 --> 04:46.560 There was resistance there, et cetera, et cetera. 04:47.010 --> 04:54.840 You can begin to as you trade, Mark, as you can begin to kind of get a feel for what they they tend 04:54.840 --> 04:55.320 to like. 04:55.830 --> 05:00.480 OK, so Mikoyan here you can see 70 has had an effect on price. 05:00.930 --> 05:07.230 So I'm going to take a wild guess and say that we're probably looking at about 15 dollar intervals or 05:07.230 --> 05:07.710 so. 05:08.970 --> 05:11.070 So let's try 55. 05:15.210 --> 05:18.930 And again, it won't be perfect necessarily. 05:19.800 --> 05:23.670 It never really is, but you can start to see that there is a pattern to this. 05:26.110 --> 05:32.320 And if you really split hairs, you can talk about, you know, for example, maybe are we going to 05:32.320 --> 05:35.960 be seeing, you know, five dollar increments? 05:35.980 --> 05:39.700 Well, there's probably a reaction on a short enough time frame. 05:40.600 --> 05:46.360 So you don't want to go crazy, which you want to see is something rather obvious. 05:46.720 --> 05:50.140 And then you kind of put it around the round number typically. 05:50.150 --> 05:57.310 So, for example, this is an area for me that I think shows support. 05:58.410 --> 06:02.700 Several times resistance, several times, it's basically sixty five dollars. 06:04.800 --> 06:10.320 I could also make an argument about the 50 dollars level. 06:16.810 --> 06:23.260 You can see certainly there are several reactions in the next video, we're going to talk about another 06:23.260 --> 06:26.650 type of support and resistance based upon Fibonacci.