Forex Trading Blog

The most important thing when trading according to the levels of support and resistance is to build a certain criteria of the breakthrough of these levels as a point to enter the market. The target of every Singapore trader is to find the best pont of entering the market. A trading technique of support and resistance levels has perfect opportunities to catch a good trend. Singapore Forex market is very random and unpredictable. Its complex system is influenced by many factors of the outside world and causes its volatility.

Let’s use the graphs of any Singapore broker to see what is hidden behind a candlestick chart when it presents a potential breakthrough of the support or resistance level. The most tolerant traders who are already in the market and keep the open positions will leave their positions open waiting for the end of the market’s correction. The more emotional traders will notice the opportunity to enter the market on the opposite side, hoping to catch the top of the market’s trend. The rest will remain as watchers, not entering the game and their opinions on the further development of the situation will be different.

At this time, the direction of prices stays uncertain, since the opinions of the traders in the market are different. In addition to that there are still a big number of other traders who are currently out of the market and they are not in a hurry to start trading.

Every trader has his own minimal measure of minimum uncertainty that is needed to start a trade. This criterion is directly influenced by the psychology of the person. As every trader has his own measure of risk, so they will start trading at a certain price level at different time. When the most of traders make their decision and start trading in a certain direction, the market will become the most stable. In the graphs it will be presented by a long trend in a certain direction accompanied by some price corrections.

There are many external factors that decide the market’s direction. The most important one is a fundamental factor based on the analysis of the macroeconomic events as well as the technical conditions laid down in the past movements. When all these parts contribute to the rate movement in the same direction, an experienced trader has an ability to see a potential trend before it starts.

Therefore to see a good trend with a high level of probability, we recommend you to make a detailed analysis of the price movements in the past together with technical and fundamental analyses that will give you much more information than watching the market waiting for the breakthrough of the resistance or support levels.