subject: Strategic Option Trading - The Power of Support and Resistance Levels and How to Trade [print this page] A resistance level is the opposite of a support level. It is where the price tends to find resistance as it is going up. This means the price is more likely to "bounce" off this level rather than break through it. However, once the price has passed this level, by an amount exceeding some noise, it is likely that it will continue rising until it finds another resistance level. The SMF Pro Trader Resistance Levels are calculated using mathematical stock trading formulas we have designed over 20 years to target exact resistance levels to the penny. This goes far beyond and is very different from your standard day trading technical analysis utilizing daily moving averages. Resistance Levels calculated at StockMarketFunding.com allow stock trading students to pinpoint the exact prices the market makers use as support and resistance. We teach people in our school how to apply mathematical ranges on minute period moving averages, daily period moving averages, and weekly moving averages. Understanding how trade stocks and identify confirmation of lows and highs are established are key to having the best entry both on long and short positions. Breakouts typically occur when stock trade in a consolidated range within our stock trading formula. The longer the consolidation period, the stronger the breakout both to the upside and down. Sometimes you need to pay more for an equity or an option because the trend is established and you actually have less risk you are buying the low end of the range and it has been established the sellers have been accommodated.
Strategic Option Trading - The Power of Support and Resistance Levels and How to Trade
By: Brian Plain
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