Finance & Accounting
Investing & Trading
Stock Trading

How to Draw Lines of Support and Resistance

Luca Moschini
A free video tutorial from Luca Moschini
Technical Trader | Investor | Chinese Medicine Instructor
4.7 instructor rating • 13 courses • 129,613 students

Lecture description

In this lesson we will talk about how to identify and draw lines of support and resistance.

Lateral lines of support and resistance can be drawn using any interval of time (5 min chart, 10 min chart, hourly, daily, weekly and monthly). The time frame to choose depends on whether you are a day trader, a swing trader or an investor. Generally, daily charts, and at times weekly or monthly charts, are most useful when looking at support and resistance.

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Learn more from the full course

Guide to Stock Trading with Candlestick & Technical Analysis

Learn stock trading in the stock market using candlestick and technical analysis for swing trading, stocks and forex

04:38:43 of on-demand video • Updated December 2020

  • Master chart reading, Japanese candlesticks and technical patterns
  • Build a solid candlestick and technical analysis foundation for trading stocks, forex, options, etfs, cryptos
  • Learn to use multiple time frames for accurately and effectively time your entry and exit strategy
  • Learn to draw lines of support and resistance to locate entry and exit areas
  • Understand the effects that emotions have when trading, and how the can emotions can positively or negatively affect your trading plan
  • Understand the driving force of the market
  • Learn the basics of market strategies (bullish, bearish and sideways)
  • Identify and trade bullish candlestick patterns
  • Identify and trade bearish candlestick patterns
  • Manage trades correctly using support and resistance levels
  • Understand correct risk and reward ratio, position size, stop losses and targets
  • How to trade with Moving Averages
  • How to trade with Stochastics and RSI using overbought and oversold conditions
English To draw lines of support and resistance Lateral lines of support and resistance can be drawn using any interval of time: 5-minute chart 10-minute chart, hourly chart, daily, weekly and monthly chart. The time frame to choose depends on whether you are a day trader, a swing trader or an investor. Generally daily charts, and at times weekly and monthly charts, are the most useful when looking at support and resistance. The first thing to do is to open up a chart using the daily time frame. When looking at the chart, go back and look at previous history: six months, one year, three years, five years... Then look at areas in the chart where the price has dropped, touched several areas consolidated and then either bounced back up or moved below it. Connect those areas by drawing an horizontal line across the chart. The lower line represents what we call support. Every time the price touched the support line and it bounced back up, the bulls were there to buy and push the price higher Then look at areas in the chart where the price moved upwards, touched several times consolidated and then bounced back down or moved above it. Connect those upper areas of consolidation by drawing a horizontal line across the chart. That upper line line represents what we call resistance. Every time the price touched the resistance line and it bounced back down, the bears were there to sell and push the price lower. Expand the chart to look at price action over the course of the past year or longer. Find other major areas of support and resistance. Come back to the six month or three month time frame and analyze the current price action in relation to those lines of support and resistance.
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