XRM chart topic

[mjstyle]

I was looking at
http://stockcharts.com/h-sc/ui?s=XRM&p=D&b=5&g=0&id=p82597428888
how did the doc tell that the support is at 1.18.. I followed what tommy said.. look at which point it didn't break but how do i look at it? like at the edge of the rectangle? As you can see there is a red triangle and a green triangle at the end... and both edge at the bottom points to 1.18 so is that how i look at it? then how do i look at resistance.. I know the long thine line pointing out is high/low and if line at top is longer then it's bear and if the line at bottom is longer then it's bull means (demand > supply) correct?

[Tommy86]

change the range to 3months and you´ll see it much clearer!

youll see bottoms at 0.91 and 1.18 ~ 1.15, these are supports

[mjstyle]

oh ok how do we tell resistance and tommy am I right about the other parts i mentioned?

[Tommy86]

every support is resistance too and vice versa. when it breaks through a resistance it becomes support...

not so sure about the demand-supply thing, in pennyland its more controlled by MMs than that.
but i think you are right, if the candleline is long at the top its not so good, cause it says it couldnt held its uptrend intraday.
same to downside

[rb122756]

mj,

One way to think of support and resistance is to think of multiple floors in a multistory building.  When you jump up and down you bounce off the floor (support) and you bump your head on the ceiling (resistance).  If you break through the ceiling to the next floor, what used to be the ceiling (resistance) is now the floor (support).

When you are drawing your support and resistance lines, you usually want to use line charts. Some people prefer candles, but a line chart ignores daily highs and lows and shows you where a stock actually closed.  For a valid support or resistance line you usually want at least 3 touches on the support / resistance line.   The more touches you get on the line, the stronger the support or resistance is at that price.