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Psychologicalroundnumber

How to Trade EURGBP With Psychological Levels [In-Depth Guide]Welcome to my 200th idea special analysis! In this idea I will explain in-depth how you can leverage psychological support and resistance levels for trading EUR/GBP. This will help you earn more money while trading, and gives you more understanding about the markets. I have been talking about this for quite a while now, and every time it shows that it works again and again. I will split this idea in multiple aspects. First of all, I will go into EUR/GBP and explain the most important levels on the chart based on the principles of human psychology. Then, I will explain what I believe are explanations for the fact that these levels are so important. Last, I will explain how you can benefit from these concepts. -- What are these psychological levels you are talking about? -- Look at how BEAUTIFUL all the numbers are on my chart. They are all incredibly round numbers, which match perfectly to the levels of support and resistance . The levels that I identified are: 0.9500 (resistance level 2) - Psychological Level! 0.9000 (resistance level 1) - Psychological Level! 0.8750 (support level 1) - Psychological Level! 0.8279 (support level 2) - Regular level Computer scripts don't come up with these round numbers, humans do. You can see human trading behavior at work here, along with human psychology. This is exactly where humans would put their limit orders, or where they will put price alarms. Let's compare the different kind of support and resistance lines you can draw. First, there are the most regular ones based on past price behavior. A local high will be extend on the chart to indicate that this has been a point where price has historically bounced. This has medium predictive power. Secondly, there are psychological levels without any price action. Simply looking at a chart and seeing EURGBP is about to hit 0.90000 exactly should make you conscious about having psychological resistance. You can add these lines to your chart. Thirdly, there is confluence between psychological and price based support or resistance. Those are the ones I charted here for you. These have incredible predictive power. Keep an eye on them. They are important. A great way to confirm these level is by zooming out and going back in time. I tried to show it on the chart here, but it would simply get too cluttered if I show you multiple timeframes. If you take these levels, and you zoom out, you see that the same levels are important over and over again. These levels can perfectly predict highs and lows throughout months, even years. This is why you should always add these on your chart! -- Why do markets have a strong tendency to have these human levels -- A high percentage of all trades are algorithmic, made by computers who couldn't care less about the actual underlying price. They are designed to get profit, and that's it. However, it's not only algorithms at work. A recent study showed that about 20% of all trades is still made by human investors. People are led by their emotions. That's what makes trading hard for beginners, and trading profitable for experts. These are the four main reasons the psychological levels work: 1) When the price surpasses such a psychological level, news articles will be published. Can you see it happening already? "EUR GBP Surged Above Levels of 0.900 in Strong Trading Day." This creates a massive awareness on the asset and leads to an increase in trades and thus volatility . 2) People put their price alerts on these levels. Like quickly mentioned above, people use tools to alert them on price changes. Where do you think they put their alerts? Exactly, on these beautifully round number. 3) People put their stops and take profits on these levels. "Hmm, when should I leave this trade? Surely if the prices go above 0.9500 I would want to be out." Again, this reinforces the importance of these levels. 4) Finally, it creates a self-fulfilling prophecy. Why does trading based on support and resistance works? Simply put, because everyone else thinks it works. If everyone draws the same lines on their charts, they start to add value simply because of the masses using these supports and resistances. -- So, How Do I Beat Other Human Traders? -- First of all, think carefully about where you put your limit orders. If the resistance is at 0.9000, don't put your limit order at 0.9010 right above a huge resistance. Be smart, and put it at 0.8990 or even a little bit lower. This reduces your profits only slightly, while greatly increasing the odds that your limit price will be hit. This also works for buy orders, never put those on round price levels. Instead, look for non-round numbers slightly disadvantageous to the profit, but very positive for the chances to get filled. Then, there is predictive power in these levels. This is all based on regular support and resistance technical analysis knowledge. You can expect uptrends to be broken around horizontal resistance, or downtrends to be broken around horizontal support. There is always increased friction around these levels, and your best bet comes from trading within these levels, never across these levels. Near such a level, exit the trade, wait for confirmation of the direction of the price and decide with which position to enter again. -- And how do I trade EUR/GBP knowing all this? -- We see that the price just got rejected at the psychological 0.9000. We have confirmation of a price reversal at that point, so a logical way to monetize this technical analysis is by entering a short position. A logical place to exit such trade is near 0.87500 I have made all this knowledge available to you completely for free on Tradingview. Please support my work by giving this idea a thumbs up! - Trading Guru -------------------------------------------------------------- Disclaimer! This post does not provide financial advice. It is for educational purposes only!
Short
by Trading-Guru
19
Apple Short Term ForecastD1 - Price is holding below the psychological level 320, continuing bearish divergence. Price is moving on the upper band of the Bollinger Bands for more than 20 candles. Note: If you want to learn in detail about Bollinger Bands then check out my blog and youtube channel. H4 - Triple wave to the upside, the price has reached the key resistance zone formed by the 161.8% (315.29) fibonacci expansion level of the first wave, 100% (325.10) fibonacci expansion level of the second wave, and the psychological level 320. Bearish divergence. H1 - If we get a valid breakout below the uptrend line shown in the chart, we may then expect further continuation lower in the short term.
AShort
by VladimirRibakov
How to Trade Directly After The BTC Surge.Everyone knows I am well known for my analyses on psychological support and resistance zones and their strong predictive capabilities. We just found two new important psychological levels in the last two days. One psychological resistance at 9450 and one psychological support at 8400. -- quick reminder on these beautiful round number levels -- Computer scripts don't come up with these round numbers, humans do. You can see human trading behavior at work here, along with human psychology. This is exactly where humans would put their limit orders, or where they will put price alarms. Let's compare the different kind of support and resistance lines you can draw. First, there are the most common ones based on past price behavior. A local high will be extend on the chart to indicate that this has been a point where price has historically bounced. This has medium predictive power. Secondly, there are psychological levels without any price action. Simply looking at a chart and seeing ETH is about to hit $150 should make you conscious about having psychological resistance. You can add these lines to your chart. Thirdly, there is confluence between psychological and price based support or resistance. Those are the ones I charted here for you. These have incredible predictive power. Keep an eye on them. They are important. When we combine the 9450 and the 8400 levels with the price based resistance of slightly below the $9000 level, I see the price struggling a lot to break through the $9000. I expect it will show a healthy retracement and cool down a little moving in the direction of the psychological support zone of $8400. Then, the bears will make space again for the bulls, and we can expect a trade at least until the current resistance area. This can give us a nice 5% trade. Remember, don't FOMO buy after you've seen these massive gains. Don't go for crazy returns. This 5% trade set-up is enough for me, and it should be enough for you. Don't worry. You will get plenty more opportunities. Follow me for consistent high quality updates, with clear explanations and charts. Please like this post to support me. - Trading Guru -------------------------------------------------------------- Disclaimer! This post does not provide financial advice. It is for educational purposes only! Recent success stories:
Long
by Trading-Guru
10
LONG AUD/USD.LONG AUD/USD, ***IF there is a clear rejection at the 38,60% level of the fibonacci, wich is on the 0,64500 key level (psychological level) and it is also on a trendline dated from March 18th 2020. The market broke a trendline dated from December 31st 2019 and also broke the 0,64500 key level wich should both now act as resistance. There is also a divergence that can be seen on on the RSI and the chart (pink lines). IMPORTANT : I am only showing an analysis on one of the many timeframes that I use.
Long
by KNFX_TRADING
AUDJPY ForecastD1 - Price has reached an important resistance zone, we have a hidden bearish divergence followed by potential continuing divergence. H4 - We have two key resistance zones that have formed based on the fibonacci expansion levels of the cycles we have. Price has reached the first key resistance zone, bearish divergence. H1 - The swing on the H1 chart is approximately at the round psychological 69.00 level. If we get a valid breakout below uptrend line and the low at 69.02 we may then expect further continuation lower.
Short
by VladimirRibakov
2
GBP USD Is in a Text Book Quality Falling Wedge [In-Depth]There are so many interesting things going on here from a technical analysis perspective. Let's break them down per section. First of all, we cannot miss this beautiful falling wedge. A falling wedge is formed when price consolidates between downward sloping support and resistance lines. The slope of the resistance line has to be steeper than that of the resistance. This indicates that lower highs are being formed faster than lower lows. This is a bullish pattern, where we expect a high impact positive rally if the price breaks through the bottom support. The price has beautifully stayed within the boundaries so far, validating the falling wedge pattern. The most interesting thing is that the way it's forming is exactly like the text books draw the pattern. If you ever wanted to understand a falling wedge, this is the most classic way of getting one! I drew the textbook example on the chart for your reference. The second part that draws my attention is the beautiful levels of which the price found resistance recently at exactly 1.2500. This is not only a price based resistance level, but also a psychological resistance level. Then, if we combine that with the trajectory of this wedge, we will see another such level soon at 1.24 near the bottom support line of the wedge. It is around this area that we can set our long position for beautiful profits. Follow me for consistent high quality updates, with clear explanations and charts. Please like this post to support me. - Trading Guru -------------------------------------------------------------- Disclaimer! This post does not provide financial advice. It is for educational purposes only!
Long
by Trading-Guru
6
Trade setup: EUR/USD analysisAm expecting the price to rally towards the psychological region of 1.12000, a new leg could be formed to the highs, price is currently respecting the 61.8% fib with morning star pattern. This will depend on USD potentially weakening, GDP consensus expected to decrease this week could be the obvious catalyst for our bias. Great risks reward 1:2! -Simple & clean chart -message me if you would like to be part of our signal team, with more in-depth and consistent analysis
Long
by danresdidualfx
Potential trade setup: GBP/AUD analysisOn a technical perspective, price is clearly indicating that GBP could potentially reverse versus the Australian currency, price is respecting the weekly region of 1.7700 with previous daily closing above it, today's daily close could add further confirmation if the candle closes as a spinning top/Doji. technicals are pointing out to price possibly extending to the 4HR resistance region as a lower high if the price breaks the counter trendline we could expect for price to revisit the psychological area of 1.81000. Fundamentals ahead could be the catalyst needed for the price to move in our favoured direction, with Australian job reports expected to fall, and an improved consensus on retail sales for GBP could strengthen the sterling. As part of risk management, SL will be moved to breakeven just in case we do conceive adverse economic data. Great risk-reward trade.
Long
by danresdidualfx
Medium-term trade setup: EUR/GBP analysisprice has overextended into the highs of 0.9000 which is a key psychological level, looking closely at candlestick behaviour we see wicks rejecting the highs showing a slowdown in momentum into the regional area of 0.9000 which has several confluences acting as a resistance. Fundamentally, the strength of the sterling ahead the next couple of weeks(lowered chances of no-deal Brexit) would be the catalyst needed to outperform the EUR and reverse to areas of support like 0.88000. Great risk/reward trade 1:5 trade safe my ppl!
Short
by danresdidualfx