I’ve made $18,000 over the last five days using basic support and resistance trading.
Not every strategy has to be the latest, greatest, most innovative technique in order for you to make money. In fact, beginner price, action trading principles can make you money, and I’m going to teach you exactly how to do that in today’s support and resistance video.
I’m Pat, this is trade with Pat. Now let’s get into it. First things first. I just want to thank everyone for watching my Bitcoin trading Tik Tok. This thing has over 3.2 million views. I can’t believe it. And it’s a great place for us to start. So, what I did in the Tik Tok is I drew this trend line right here.
This trend line has been tested multiple times and has not broken structure. So, it’s very possible that the Bitcoin price may continue to break down. $30,000 mark. I was telling people in the Tik Tok that I believe a retest of this $30,000 mark would be a good area for us to purchase Bitcoin or even place a Bitcoin Day trade for an easy win.
Supports and Resistance Strategy
The reason I believe this is because of support and resistance, which is what this video is all about. So, you can see this purple area right here. This is my support line. The reason this is support is because the price, which is the candles that you’re seeing here. Has come and tested this level on multiple occasions as both support and resistance, making this a very strong level.
You can see here, the buyers pushed up the price of Bitcoin multiple times at this level frequently turning into a large uptrend. So, while it’s not impossible for the price to break through this $30,000 mark, it is a key level of support because. Pushed up the price in the past. So, this is a key level right here that we can use to determine higher probability trading opportunities.
There’s a couple of ways that we can use this level. We can wait for the price of Bitcoin to come down to this level, retest it a couple of times, and then place a buy trade. Or if the price breaks through the support like you’re seeing right here, this support level now turns to resistance and can be used for selling trade opportunities if it’s retested as an area of value.
So today I’m focused on a very specific support and resistance strategy, which is generally breaking out from ranging market conditions. Okay. So, this is what a range looks like right here. And for sell trades, I’m going to want to break through the support, turn that into resistance, test that area, and then place my sell trade and for buy trades I’m looking for the market to come out the top, retest the support level and then place my buy trade. So those are the types of trades I am looking for. Let’s get into the examples.
Trade Example #1
All right. So, this is the first example I’m going to show you today. This is a US dollar Japanese Yen sell trade. You can see the first thing I’m doing is setting up my support and resistance zones. You can see I have three zones on the chart right now. I’m trading the one-hour timeframe, but I’m setting my zones up on the four-hour timeframe. So, the first zone I set up is right here. There’s a lot of action at this level. And the second zone I set up is because of this price right here, as well as obviously this price here and here as well.
And then my third level I set up the price because of this right here. This is basically my bottom here. And this level is really tested a lot. So, this is a very strong level. And that’s why I use that level, this support area right here for my take profit. That’s where I’m trying to make my money. Now, once I have my support and resistance set up, I’m just going to the one-hour timeframe. This is a little bit easier for me to see less noise, find my trade opportunity.
So, what we have here is my support zone being broken by the price. Then the price gets into a bit of a range right here. So, what I wanted to see was the price come below, turn this support here into resistance, and then retest that resistance before I opened my trade. It actually retests twice, and I placed my trade at this level.
Obviously, I could put my trade here, but I find if you get multiple retests, it’s even stronger. So that’s what I did. And this is what happened with the trade. You could see it, it went in my direction and did smash my take profit, banking me $2517.
Trade Example #2
So, for my second trade, we are on the Great Britain pound. US dollar. You can see the first thing I’m doing is setting up my support and resistance. Here’s the first zone here. You could see, I have this zone set because of all of this pressure here. As well as the pressure right here, then I have my second zone set because of this candle here and all of the action around here.
And then my last zone, you can see here, there’s quite a bit of action at this level. So, this is where I set my take profit. This is a really good example because this is a trend continuation trade. You can see here, If I take this trend line, we are clearly in a downtrend. Now what happened was we were in an uptrend at one point, we had a double top with a neckline right here, and this pattern signifies that the market is starting to reverse.
So now that I have my support and resistance zones, I want to switch to the one-hour time frame. On the one-hour timeframe, you could see the price starts to consolidate within this zone, bouncing back and forth between my support and resistance. What I want to happen on this trade is to have the price closed beneath my support zone, and then retest this now as resistance. This is where I’m placing my trade opportunity and you can see that’s exactly what happened with this trade. And it shot into my direction right after placing the trade for a huge win of $3,799. And this was a risk reward ratio of 6.31%. So, if you risk 2% on this trade, you’d be winning around 12.6%. It’s a fantastic trade.
So, one more time What happened is I was stuck in a range. I wanted the price to break Through my support, turn that support into resistance and then retest the resistance level, which is what happens right here. And then I placed my trade at this level and that’s where I won the trade.
Trade Example #3
So, for my third trade using this strategy, it’s very similar to the last one. You can see that we reached the top of the market right here, and then we reverse. If I take a trend line, it’s quite apparent again, that we are in a downtrend. So, this is a solid support and resistance continuation trade. All I’m doing is following the trend here. So, the first thing I do is I come to the four-hour timeframe just like last time. And then I set my support and resistance zones. You can see, this is a very busy area here. You could see this area is also tested here in the area below is very busy here with lots of price and movement. So, this is where I set my support zones.
Then I go to the one-hour timeframe, and this is where I’m looking for my entry opportunity. So just like the last example, once we get into this area, we’re bouncing between support and resistance for a while, consolidating the price and ranging. So, what I’m waiting for is the price to either break out the top and retest and go up, or in this case, I’m really hoping for the price to break out the bottom, because then we’re in that trend continuation taking advantage of the trend, which is clearly going down already.
So once the market ranges for a while, we do get the break in my support. And then shortly after we do retest this as resistance in the market starts to shoot down. I got into this trade a little bit later around here, as opposed to where I wanted to probably higher, closer to my resistance level, but that’s okay because the trade did go into my direction shooting right down here and winning me $2,819 on this trade. A solid solid win.
Trade Example #4
Alright, this next trade is a Euro Great Britain pound by trade. This is the only by trade I did during this entire few days. And this trade is a little bit different than the others because the trend direction isn’t as clear. You can see, we are definitely stuck in a range during this area on the four-hour timeframe. At one point, we do dip below this, but we have the double bottom, and that seems to signal a reversal in the market. So, the market does come up to my support and at this point I’m waiting for it to break through before I place my trade opportunity.
You can see, I have my support and resistance set at the correct levels. These are the levels where the price is most active. What I do next obviously is go to the one-hour timeframe. And this is where I’m looking for my trade opportunity.
So, on this trade, we break through this resistance. We come back, we retest that support level and I place my trade shortly after that, right around here. And it goes right into my direction, winning myself, another $2171 from this trade. And again, this is all simple support and resistance. You can see, I have my support level set up here and I have a support level set up here. For this trade, I’m really only focused on this one. I want the price to break out, retest the level, and that’s where I place my trade.
This ended up being a solid win, and I set my take profit at this level right here, because this was an area of support and resistance in the past. So, support and resistance is the strategy that I’m using to enter my trades and the strategy that I’m using to exit my trades. It’s simple. I know it may seem too simple, but it really is this effective.
Trade Example #5
I actually had another trade to show you here, but this trade was a little bit more confusing. This is a Euro US dollar trade. You can see, I have my support and resistance levels set up. On this trade the price breaks through the support level. And then breaks through the resistance level and then finally breaks through the support level and then retest that level so I placed my trades somewhere around here. This isn’t as clean as the other trades because we didn’t have much of a range here and a single break and retest. So, this isn’t the one you want to focus on. But it is still a winning trade. And I did bank myself $2,500 on this trade.
So here is my FX book again. Obviously, I didn’t show you the take profit ones on every single trade. I was focused on showing you the take profit twos. But what I was doing is running two trades at the same time. So, on this example, I would have won my initial trade somewhere around here, and then I would have let the trade come back, retest this level again, before finally winning the take profit two.
So, this is definitely a way that you can trade. You can run two trades at a time. You can run one at a time. It all depends on how confident you are in your strategy and whether or not you want those trades to run.
So obviously this was an incredible week banking, the $18,758. This is just the first support and resistance lesson I have to teach you. Obviously, I’m working on my teaching skills. And I’m getting there, but I’m older guys. So please bear with me. I have a lot to share with you. Now, if you have anything you want to add, anything you want to ask, please leave a comment below. Other than that, I hope you will come and join me in my VIP group. There are three analysts in there right now Working tirelessly to provide you with winning trading signals every single day. Thanks for watching the video. If you enjoyed it, please watch this next video here or this next video here. Thank you so much for watching, please Like, subscribe. I love you. I’m out of here. Peace.