S & R - dynamic and static - HH's & HL's or LH's & LL's


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The title of this thread is the key in any technical analysis with currency pairs

Trouble is - as trading is not a science and not black or white - you have to be able to work in the "grey area"

There is a relationship on all time frames from 10 second tick chart to a monthly or even quarterly / yearly chart - between these TA terms.

Static support and resistance can be from daily pivots / Fibonacci % / or just interim levels and of course popular big round numbers such as 1.3000 on the EU

Dynamic support and resistance is additional and changes with market movements and can be found with trend lines and even from moving averages, harmonic patterns, Clouds OB and OS situations etc etc

Higher Highs and Higher Lows can be found on all time frames in a major Bull or up rally - but are always shown first on the smaller time frames - as any moves starts with the first step ;-)

Lower Highs and Lower Lows can also be found on any time frames on major Bear or down rallies - but as before the smaller time frames will show them first

Decide the time frame periods you want to trade in - but remember the larger frames are less efficient and take longer to make great rewards ie - guess which will happen first - 1) a 40 pip move from a 10 pip stop giving an RR of 4 - or
2) Same RR ie 4 - 50 pip stop and 200 pip target.?

So if you want say 10 good trades in a week with RR's over 3 or 4 - with exposure to only 1 or 2 pairs - stay with the short frames under 60 mins max

if you take multi trades on the 4 hr or higher frames - you will exposed for a long time at higher risks and for example 4 trades open at 2% risk of capital is a total risk of 8% and it might take you 1 day or several days to be able to bank your gains.

On small frames you may be able to take profit and bank every hour - and then compound etc using the increase on your capital.

Is it harder or more difficult to trade on the smaller frames ?

Well i have mentioned the main criteria in the title - its the same on a 5 min chart to a 4 hr chart - but it will still take 1000's of trades and hours to become proficient etc.

Link the title TA's with times of the hour and sessions etc and you should then end up with enough "clues" to make your decisions

GL and have a successful 2014 and please don't let your "minds" natural "bias" influence your trading decisions ;-))


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