One of the most common asked questions.
When price is creating higher high or when the resistance level is broken, what can I do? when and where should I enter?
The answer is very simple
Breakout (structure broken) > WAIT for pull back (to structure level) > BUY
As we can see from the chart on the left, when there's a breakout (structure broken / new high is created), do not chase or enter immediately. The secret of pull back trade is to WAIT for it to pull back. Be patient, patient is the key to success.
The rationale behind is before the breakout happen, the yellow structure is a resistance level. But when it's broken and new high is created, the resistance level will become support level. That is why we want to buy low (Support level) and sell high (Resistance level)
Good luck and happy trading!
When price is creating higher high or when the resistance level is broken, what can I do? when and where should I enter?
The answer is very simple
Breakout (structure broken) > WAIT for pull back (to structure level) > BUY
As we can see from the chart on the left, when there's a breakout (structure broken / new high is created), do not chase or enter immediately. The secret of pull back trade is to WAIT for it to pull back. Be patient, patient is the key to success.
The rationale behind is before the breakout happen, the yellow structure is a resistance level. But when it's broken and new high is created, the resistance level will become support level. That is why we want to buy low (Support level) and sell high (Resistance level)
Good luck and happy trading!