What a level is
Support is a price area where buying has repeatedly stopped a fall. Resistance is where selling has repeatedly stopped a rise. They exist because traders remember: the people who bought at a level last time buy there again, and the ones who missed it are waiting for it.
Zones, not lines
Price rarely stops at exactly the same number. Draw a level as a band a few pips wide that covers the wicks and closes of the touches, and treat a move into the band as a test rather than a break.
Finding the ones that matter
- Touches. A level tested three times is more meaningful than one tested once — but also more likely to break the fourth time, as the orders there get used up.
- Timeframe. A weekly level outranks an hourly one. Mark the higher-timeframe levels first, then look for entries on the lower.
- Round numbers. 1.1000 on
EURUSD, 150.00 onUSDJPY— option strikes and stop clusters sit there.
The flip
When support breaks, it often becomes resistance; when resistance breaks, it often becomes support. The traders who were wrong at the old level use the retest to get out at break-even, which is the selling (or buying) that makes the flip hold.
Trading a level
- 1.Mark the zone on the higher timeframe.
- 2.Wait for price to arrive, then for a reaction — a rejection candle, a lower-timeframe structure change.
- 3.Stop beyond the zone; target the next zone. Check the risk:reward before entering.
Summary
Support and resistance are zones where price has turned before. Draw them wide, rank them by timeframe and touches, wait for a reaction, and expect a broken level to flip.