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Old Resistance Becomes New Support Again

Always remember to keep in mind what is happening in the markets before you take your trade. It is best to know the obvious before you make a mistake that may cause you to lose a lot of money. In the case of trading the EURUSD today we had noticed that the euro had been pounded over the past few months. Any time you see a price get hit so hard you wonder two things. Either the price can go to zero or the price will bounce. Obviously, the price is not to go to zero anytime soon. However, you must be aware of how much more room it could fall before going back up.

We took today’s trade based on price action at bank to binary. You can see how the price had moved up through resistance and eventually came back down to the same level. We decided to take the call option at this level thinking this was a new area of support. Remember, we always talk about old resistance becoming new support. Although the trade did not move many pips in our favor in the and, it did turn out to be a great trade. Price held the line at our entry point and only went against us about a half a pip. Price then ended up finishing two pips in our favor giving us a nice payout of $350.

The image below shows the price action on a 1 min. MetaTrader chart. You can see how price moved through resistance and then came back down and touched it again making it support. We entered this trade seeing new higher lows on the price on the EURUSD. As price held this line it moved back up given us a nice solid winner. These are the areas you need to seek when you’re trading the binary markets. Remember, we got in this trade with only 3 minutes to go. Any time you have that Short amount of time you need to be sure that you have the right direction calculated.

Bounce off Old Resistance

We’ve been talking a lot about psychology and trading lately. Always keep in mind that you will win trades and you will lose just as well. The best thing you can do is understand that this can happen. You must accept the fact that you will lose trades. If you do not accept this fact you will end up losing even more money. Don’t let yourself go to the downside. I just want to make sure you guys are clear about trading in any market. This can happen in the binary markets, Forex markets, stock markets or any other market for that matter. You must be prepared for price to go against you on multiple occasions. Make good educated guesses on your trades and hopefully more often than not you will have winning trades versus losing trades.

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