What is a Support/Resistance Zone?
Quick Answer: Support and resistance zones are price regions where order flow repeatedly stalls or reverses, offering clear risk-reward frameworks.
Understanding Support and Resistance Zones
A support/resistance zone (often shortened to zone) is a price region where buying or selling pressure repeatedly emerges. Zones are broader than single price levels, encompassing clusters of reactions.
Building Zones
Plot zones using swing highs/lows, volume nodes, and supply/demand areas. Higher-time-frame zones carry more weight and should frame lower-time-frame trades.
Execution Strategy
Wait for confirmation such as rejection wicks, inside bars, or divergence before entering. Zones offer clear locations for stop placement.
Dynamic Zones
Zones can shift when broken; former resistance often becomes support and vice versa. Update charts after major breakouts to avoid outdated bias.
Avoid Overdrawing
Too many zones clutter your chart. Focus on key levels around recent highs/lows or confluences with fundamental catalysts.
Related Terms
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