Key Rules for Trading

1. The more times price tests a level, the stronger that level becomes.
   If a support or resistance level holds over time, traders begin to rely on it, increasing order volume at that level.
2. When a level is broken, the move is often strong.
   A well-tested level that finally breaks often leads to a sharp move as trapped traders exit or reverse positions.
3. Support can become resistance, and vice versa.
   If price breaks through a resistance level, that level can act as support on a retracement—and the opposite is true.

Support and Resistance in Action

This trading often involves identifying past price reactions on the chart and forecasting future behavior.

• In an uptrend: price hits a resistance level, pulls back, breaks it, and then that resistance turns into new support.
• In a downtrend: price bounces at support, breaks it, and then the former support becomes resistance.

Why it's Matter in Forex

• They are essential tools in technical analysis.
• They help set entry and exit points for trades.
• They help traders anticipate breakouts and reversals.
• They reflect collective trader behavior driven by key psychological levels.

Using it in forex will help you become more confident in executing trades and understanding market structure.