This Great Graphic is a month bar chart of the euro, and Bloomberg uses a synthetic calculation to capture its value before EMU.
Trading with Support and Resistance
From a strategic point of view, support and resistance levels represent smart places to anticipate a reaction in the price of an asset, and therefore represent a basic tool in technical analysis.
Numerous traders use them, but the diversity in application and integration of support and resistance analysis tell us that charting is definitely not an exact science and more of an art.
One of the most common mistakes that new traders make is buying too close to a line of resistance or selling too close to a line of support. In this page we provide enough set-ups and real time examples, to make sure you thoroughly understand this simple yet important dynamic.
Support and Resistance in EUR-based pairs
Identifying Supply and Demand
There where the difference between the number of buyers and sellers get more remarkable, it tends to form a Support or Resistance level. Your next logical quest will be to identify them on a price chart.
Historical and potential Support and Resistance levels, can lead to several constructs: horizontal lines and dynamic trendlines are the most used ones and can be based on significant highs and lows. Lines are also used to delineate price channels as well as classical chart figures such as triangles and wedges.
Some technical indicators can act as potential Support and Resistance levels, such as moving averages, Pivot Points and Fibonacci extensions and retracements which are commonly used in Elliott Wave analysis.
Round numbers - those quotes ending in 00 or 50- and emotional spikes are often perceived as Support and Resistance levels.
When these levels encompass a larger area on the charts technicians speak of a Support and Resistance Zone.
JPY-related Support and Resistance
Key Points: USD/JPY rallies due to an uptick in US Bond Yields. Pair reaching a key reversal point. Watch for a break of 106.20 to confirm a bearish bias. [...] the USDJPY has rallied strongly and is nearing a challenge of the 107.00 handle. However, there are some concerning technical signals starting to appear which could see the pair tumble in the coming days.
GBP-based pairs Support and Resistance
gbp/usd supply and demand
Support and Resistance in related markets
Streaming Live Rates and Pivot Points