#4: TREND CHANGERS

Support and resistance levels are trend changers.

Every time, price goes to a support level, you should expect that an uptrend may be forming soon.

Every time price goes to a resistance level, you should expect that a downtrend may be forming soon.

Support levels are demand levels

Resistance levels are supply levels.

When price heads to support and resistance levels, the demand and supply changes.

Ok, this is not a difficult concept to understand.

What happens at support levels? Lots of buying power comes in, right? So what happens to price? It shoots up. Right.

In a resistance level, the opposite happens. Demand weakens and there’s an oversupply. What happens if there’s an oversupply?

Price drops.