[Support/Resistance] How to stay ahead of the pack?

This is going to be the second post on Support/Resistance Zones. Click here to read about the difference between looking at Support/Resistance levels as Lines or as Zones.

In this post I am going to talk about how I use 2 simple techniques to stay ahead of the pack when I trade the markets.

1. Using Equidistant Channels to mark slanting Support/Resistance Zones

 

2. Using Rectangle Tool to demarcate Horizontal Support/Resistance Zones 

It's a very simple technique. But it gives you a powerful visual signature on what's going on this specific trading instrument at the moment. 

This is how you can use this technique only if you love to trade in a range bound trading environment. 

If you're a Breakout Trader, you can use rectangles to demarcate sideways price action & make your entry after the breakout.

And this is how I use both of these simple techniques together to stay ahead of the pack when I'm trading the markets. 

Start using them from today itself. And don't forget to comment your experiences, views & feedback.

Good Hunting to you!

Sachith Sumanathilake

[USDJPY] How to trade the Coil...

I saw this potentially bullish Symmetrical Triangle Pattern formation for last few weeks in USDJPY & just thought to write about it a bit!

The Bigger Picture!

Let's look at the bigger picture...

If we look at the monthly chart of USDJPY, we can clearly see that this sexy lady is approaching a major bearish zone! I don't expect it to break this Resistance Zone in a single shot! Most probably we'll see a bearish correction once after the price action reach this multi-year resistance zone.

USDJPY was stagnating around this price level for last few months due to indecision among the traders about the future direction. We can clearly see a Coil or Symmetrical Triangle Classical Technical Chart Pattern in this greener circle. Let's zoom in! 

USDJPY Weekly Chart

How many of you believe this as a Symmetrical Triangle Pattern? 

Then, what about the Price Target ? 

x = x, isn't it? 

Let's see how it goes. And don't ever forget to have your stop-loss ;) 

[My Opinion] : 

USDJPY has the potential to reach 105.00-107.00 before next big downturn!

I can be embarrassingly wrong!

Good Hunting to you!

Sachith Sumanathilake

Sri Lanka