Master True Support and Resistance Levels Like a Pro

a candle suddenly turns red does not give it the authority to claim support and resistance. If you do not do your support and resistance correctly, you will fail We want these smaller boys to trade in the wrong direction. So people like you as the bigger boy know the flow.

That, my friends, is true support and resistance. Something that has value. what is true support and resistance.

let me pull up a line on the screen and you tell me if that's true. Support and resistance. All right.

Is that true? Support equals resistance right there. Notice something as small and as simple as support equals resistance.

And yet all kinds of answers. No one knows what. What's going on?

A simple support equals resistance. But yet everyone's trying to find out the next best strategy. The most complicated stuff to do.

But yet the simplest thing is unknown. So the very basics need to be very, very strictly studied because the basics is where it all is. That's where all the money is actually.

Let's say this is your car, right? You're driving. Okay.

You're driving just fine. Now, while you're driving, you slow down a bit, and then you continue driving. Now, the moment where you slow down a bit and you continue driving.

You think later on that day, you're going to remember that moment when you slowed down from 90km/h to 80km/h. No, No one cares. Just because in the charts, a candle suddenly turns red does not give it the authority to claim support and resistance.

Does that make sense? Now, you're going forward. And now suddenly the market is doing this.

Imagine you're in that same car and you're not pulling back, and your car is looking like it's halted, right? According to someone who doesn't, who's not in the car with you and he just sees this. for them, it's going to look like, well, maybe there is a police officer there who stopped me.

So he's just waiting there. So that becomes important. Like, why is he waiting here?

There's something there. Now, as you're driving again and you're going in the same direction, and then suddenly it pulls back like that. what do you think is happening now?

So think about it this way. In this whole process of going up. Okay, just think for a moment.

Someone is coming at full speed, right? Extreme power coming in. Who in their right mind is going to stand in front of that car and not just stop the car, but turn it around into the other direction?

Would you say that thing is important? that's important, right? That, my friends, is true support and resistance.

Something that has value. Something that our big boy is afraid of. And if he's afraid of it, then you and I better be afraid of it.

Does that make sense? So we're going to put this onto our chart. But what we're going to do I'm going to give you a brief explanation of the rubber band man theory.

Okay? Let's take a look at the markets. So the markets start from here.

Let's say just as an example. And the markets are starting to move upwards Now the rubber band. My theory is imagine this is you right here and you are running and imagine a rubber band around your stomach.

Okay. Which starts from here. You run as far as you can.

You reach this highest point and then you start to take some rest. Okay. How much rest have you taken?

Think in terms of percentage. 20%. You know 15%.

30%. Okay. Compared to your run, is your rest very intimidating?

No. It's okay. And then you run again and then you break your own previous record.

if you're looking at that runner, would you say that runner is still quite healthy? He's got some energy. Absolutely.

And then he rests again. Now how much is he resting this time? You know, 50%, right?

50%. Now, what are you thinking in your mind about this guy who's running? You're like, oh, what's up with this guy, man?

He's not my, know, famous horse. You know, he's not good at running anymore. He's running out of breath.

He's getting tired. There you go. I saw a cute girl you ran out of.

Red bull got distracted. So he's running again. He runs and he barely reaches his own new record.

And he pulls back to this much. How much rest is he doing this time? 80%.

What does it tell you at this stage? Right now, he's very tired. Is it telling you to sell?

no. It is telling you not to sell yet. This is where most people go wrong.

This is the moment everyone jumps in thinking it's a sell. Premature selling. It just means he's extremely tired.

He's barely making any higher highs, but he is not one to give up. So this is a moment when a trend turns into a channel. Okay, markets don't just go up and then suddenly down.

Right. need a transitional phase. Right.

need to go up. Slow down and then make a turn. Correct.

Okay. This is this is something we'll go into very big detail into the course as well into the mastering price section. Of course, we'll get into that later.

so let's take a look at this. So I'm giving you guys a little bit of a sneak peek of what's what's happens inside the MPC. Or so Now are you curious about the exact strategy Naveen has been using to approach the markets?

The Mastering Price Action course reviews, all of that. In that course you can understand the logic behind each price action movement, and from that you will be able to take your trading to the next level by having a much more solid understanding of the markets. And because you are a subscriber, just click on the link in the description below to access our exclusive discount.

Time to take your trading to the next level. All right, let's get back to the video. Now think about it this way.

your rubber band man is running from here. He's running downwards. He runs downward.

He reaches this point. Is the guy healthy? Yeah.

He's healthy, And then he takes some rest a little bit. Is the guy healthy? Absolutely.

He runs again, and then he takes a rest a bit. Is the guy healthy? Yes.

He runs again and then he rests again. Is he healthy? You notice every run that he's doing is significantly slowing down.

But does it mean he's quitting? He runs again, barely making lower lows, and then he comes back again. He runs again, barely even making it to the recent low that he just did.

And then he dies. He rest almost 100%. Does that make sense?

You see how the transitional phrase from a downward market switches to an upward market? Okay, now in this entire example, the reason why I bring this, bringing this up, that even if I give you this technique without the correct understanding of true support equals resistance, even this technique will be used. Wrong.

So the problem is, even with this technique, if you read Support and resistance wrong, You're gonna have some problems. And let me explain to you why. What if you read this as here's the buyer and he's resting, okay.

The runner, he's running up again and he's resting. Would you say he's still healthy? Yeah.

And then this little area that in reality is not true. Support equals resistance. Okay.

He goes up to here. And then if we count that as a rest according to this, what's going to go into your mind. That he he barely could beat his recent high.

Yeah. Or pay close attention. Something's going on.

What happens to the next run when he runs again and then he rests? How much of a rest would you count that as? 60.

80%. Right. Now, let me ask you this question.

What if you didn't read the support resistance here and you said, oh, that's all one run. How much of a retracement is that? Now?

you see how the numbers have actually changed completely? If you do not do your support and resistance correctly, you will fail even though you have the right strategy, techniques, system indicator, whatever you might have, your golden goose. Does that make sense?

So Let's do some practicing. Okay, that's what we're here for. Let's go into some practice okay.

Let's go into pound USD first. Okay. I'm going to choose a random chart.

Let's say monthly chart okay. Does it matter what time frame I use. No absolutely not.

Support resistance is support resistance everywhere when this seller is coming down, would you say this is true? Support equals resistance. So let's get into all the criterias of a support equals resistance criteria.

Number one what's a true support equals resistance. Something that can stop you right. Stop in turn.

That's a true support equals resistance. Now how much of a turn makes the support resistance even more powerful? The next thing.

Okay, the police officer. The moment where you stop there, you don't pull back, but you're just stop, stop, stop, stop, stop. There's a cop there.

There's a policeman there. There's something about that area that even our big boys like. Wait, give it a few minutes, okay?

For a good half a year, he did not move because he was like, I don't know what's going on here. Why don't you say that's important? That's a half a year.

He didn't go anywhere. That's valuable data for us. Why is he not going anywhere?

Who are we to say? That's nothing. If the big boy is halting, there, then we need to take notice of that.

Okay, so let's take a look at this further. He goes down, he comes to this area here. Boom.

And then he pulls back. Is this true? Support equals resistance right here.

Absolutely, Someone is standing in front of this massive train that's coming and saying, I'm going to stop you. And I'm not just going to stop you. I'm going to turn you around.

That is very powerful. Okay. Let's take a look at it in a different area.

I'm going to do this. I'm going to cover this up so you guys don't get distracted. I'm going to cover all of this up.

And I want you to focus on this area. These are buyers coming in. Is this true?

Support equals resistance. These things. I don't have a single yes in there.

Generally the moment people see a red candle or an opposite color candle, they count that as support equals resistance. Okay. So let's spice it up a little bit more.

Is this true. Support equals resistance. When the market's coming down from here, he comes all the way this far and around this area he starts getting problems.

And I'm going to put a line across where the problems happen because that's the first problem that happen. Do you think this matters? It has barely any relevance.

Relevance is here. That's true. Support equals resistance, which is why you will see support does equal resistance going forward.

There needs to be a reason now even though that candle looks pretty big. Now if I was to just do this, for example, okay, if I was to just do this and I cover this whole thing up and I say just that much, for example, doesn't that look like from this down move? That's a pretty big that's a 50% retracement.

Right. If I just do it like that, that looks like a 50% retracement. But that's where sometimes the issues happen is like, oh man, that can't be true.

Support equals resistance. Because if you have your data, you will know it's incorrect. Now, how many of you guys have issue with data like, well, how do I know where to begin then?

Do I count it from here or do I count it from later on? Okay, many times I'll be seeing traders. They'll do one of two things.

Trader type number one. They wake up in the morning, they open their charts and they're like, looks like it's going down. I'm going to sell today.

That's type number one. Type number two is like they open up any chart. Whatever chart it might be the one minute, it might be the ten month chart, whatever it might be, they might be looking at this like, oh, according from the screen, from this corner to this corner, it's been going down for a long, long time.

It can't go down forever. I'm going to buy it. And then we got people who are sitting there.

Here's type number three. There's the type number three. Two.

Don't get me wrong. They're the type number three. Type number three is okay I see this area.

I want to bloody sell it. then suddenly I realized oh crap, it's a big downtrend. It can go down forever.

So now you're confused. What do I do. Okay.

You're thinking of sell the whole time. And all it took was you went on to some forum and someone's like, I'm looking to buy this. And you're like, maybe it could be a buy.

I'm not sure anymore. Right. This happens time and time and time again.

Okay. So let's go into some more practices, because this is very critical okay. How many of you guys see this as a overall downtrend?

Right. If I do this. How many of you guys see this as an uptrend?

Right now if I didn't show you the downtrend earlier this looks like proper uptrend. Like it's higher high sequence. You know it's just buyers are in control.

So the question now comes is okay so Naveen I am on the four hour chart here. Right I can see the two 40 minutes here. Or you can see the four h which means the four hour chart.

I'm on the four hour chart and I see it's an overall downtrend. But on that day I saw this was an uptrend. But if I don't buy it, am I supposed to sell it?

And if I have to sell it one, do I sell it? In this confusion, never get a chance to trade. like when the bloody hell do I trade?

It looks like a buy, but also looks like a sell. Like, what is this? Yeah, it's a mass confusion, isn't it?

But for for the majority of, you know, this is a big issue, right? This is a big issues. Like what?

Which way do I go? Okay. an issue with many, many people in fact, this was my biggest problem when I started.

I was like, I have the knowledge, I have the understanding. Why doesn't it work? And when it does work, it works so perfectly sometimes.

But at other times it just completely is wrong. And we're like, what's going on, When there any strategy, any technique you're doing, sometimes it gets very, very good results. Almost to the Pip.

And then at some times it's completely wrong. And you're sitting there scratching your head, what the hell happened? And then whoever the mentor guru or the person who sold you, the strategy is going to be like, oh, every now and then you'll have losses.

All right. Because there is no idea of what are we looking at? okay, okay, here we go.

So the last thing we were talking about is. Okay, Naveen, I know I have a data confusion thing. We just discussed that.

So we have this issue about, well, okay, I get it. I'm on the four hour chart. What do I do now?

Right. Now how much data you're supposed to look at revolves all around how you want to trade. You know, that's the major problem with all traders these days.

Okay. I'm going to give you one simple thing. Why do you trade?

What do you want from trading? you'll see. In your mind you might say freedom, income, this and that.

Now, if you know why you want to trade freedom does not mean you have to sit in front of your screen for longer than you're already sitting at your desk, at your job. Correct. That's not freedom.

That's just going the opposite direction. Okay, let's get into it a little bit more deeper. We need to really understand why we're doing this, why we're doing this.

If you do not know why you're doing it, what's the point of chasing it? You have to understand why you're doing this. So first thing first, if you're on the four hour chart and you're looking at this overall flow right, how long did it take to make this overall flow?

Look at the dates here. This is the sixth. This is the eight.

This is the 13th. And then right here is the 27th. So it's probably the fifth here maybe or the fourth probably.

Okay. From the fifth this thing started to pull downwards and then after pulling back before it resumed its momentum, it took a month. Now ask yourself, do I want to trade if I'm opening my charts today and I want to trade today, does it matter if I am looking for a monthly trend like that?

Does it really matter? Do I really need that much data? Okay, so let's start to cut this down based on your preference as a trader.

So how about that much data? How often do you want to trade. Okay let's go further.

about that much data right there. How big is that? That's still a week.

Okay, what you want to do is not just constantly switch timeframes. You want to look at how much data you're looking at in relevance to what's the time frame of the chart. This helps you understand of what you're trying to do and when, not how, but when, right?

If you want to trade today, it doesn't matter what happened two years ago. Who the bloody f cares right? It's not relevant right now unless it's a very major, major major major, major, major support which everyone thinks every day is a major support.

Okay, so let's get into it even a little bit deeper. Now you want to trade as close as you want to today for example And you're looking at this area and you're like, okay, I want to trade today. What's your trend for today?

I don't care what the overall trend says. That's not your job. Your job is I want to trade today for you.

Your trend is down okay. If your trend is down, you want to do only one simple thing. Wherever you're seeing this in terms of your relationship to the time, you're going to now say, this is my big boy.

Okay, we're going I'm going to explain what that means. Okay? This is my big boy.

What does that mean? This means this is what you're going to refer to as your higher time frame, or what we call the universe above. You care about what does your big boy say?

Your immediate command above you. Perfect. Now, once we got that area down notice, would we consider this as true?

Support equals resistance. No. Now let me ask you a question.

Just just as a simple logic question, what do you think might happen if I go down to the one hour or the 15 minutes for them? Would this be true? Support equals resistance.

Oh yeah. Absolutely. Right.

Okay. Just keep that in mind. Keep that floating around in your mind that what is not true support and resistance to the big boy can still be true.

Support and resistance to the smaller boy. Now this candle right here, how big is this candle? How long did it take to make this candle?

Four hours. Right. It's a four hour chart.

It took four hours to make that candle. What do we see here? A simple red bar, right.

But if we go down to the five minutes or the 15 minutes, will we not see something like this? Right. Now, for the person who wants to trade instantly for him, these are all true support equals resistance.

Correct? But do you see the big boy on the four hour drawing all those lines? You know, suddenly looking like, I don't know, what the hell am I looking at anymore?

There's lines everywhere. No, he's not doing that. Because to him it's not logical.

So the question comes back to is the lines that you draw, who is looking at them, who is looking at those lines. That is what's critical. If the big boy is looking at that line, it's going to make an effect to your trades on the lower time frame.

But if they're not looking at that line, you play your business the way you need to. You're okay. Now we're not concerned about the daily because to the daily this thing right here, let me remove all these drawings.

Now on the four hours would we say this is true? Support equals resistance right there. Yeah.

Would we say this might be some true support equals resistance. Yeah. In this whole thing, if I switch the chart to daily, it'll just look like it's a nice smooth down move for the daily.

None of those crap matters. Make sense okay, so there's a big logic behind who's watching these lines okay. There's a big logic behind that.

And then you need to master this idea of okay, I don't care about all of this stuff anymore, because obviously that's important, but not to me because I'm not trying to trade five years from now. I'm trying to trade today or tomorrow. Yeah, it's the past, but it is relevant to people who are looking at a pullback that might come up to here and then sell again in the future, but that's like months down the line okay.

And we don't have that kind of time to wait. Right. So moving forward let's take a look at this.

Now on a lower time frame. This is a downtrend for us as a big boy. Yes We're going to go into a smaller time frame.

Let me mark this area boom right here. And we're stopping somewhere here. Let's say okay let's mark that area.

Let's go into the one hour. This is three. It's divided by four.

Basically we're just going down to the one hour if I say this area is that true. Support equals resistance. No.

But then if I see from this sell, would you think that would be true? Support equals resistance. Yeah.

Because you're a big boy is watching this too. Remember the four hour guy can see that the four hour guy cannot see this. But that's okay.

You can see it and you can trade this if you get a if you get an opportunity. But for you, you know that this has an important level. Now as this pullback starts to come in.

This one here okay I'm going to go into it very thoroughly. Do you guys remember that rubber band man that I showed you guys. I hope you haven't forgot it because that's the reason why I explain it to show you at this moment.

Here we go. I'm going to go down to one more time frame knowing that this is our line. We are not drawing any more.

If we keep drawing lines on a different time frame, different time frame, we're going to get lost. We know the direction is down. We don't care about anything else.

That's our line. We're going to go down to the 15 minutes now and we're going to watch for this area. Okay.

So in this whole area where there was a hold hold hold hold hold hold hold. And then suddenly, you know, whether you even if you look at this as a downtrend suddenly would you say there's a buyer coming up. That's good.

We want that buyer to come up. We want these smaller boys to trade in the wrong direction. So people like you as the bigger boy know the flow.

don't care about the daily, weekly flow. You just need to care about your flow from the time frame. You want to trade based on what you desire.

Makes sense. Now here comes the buyer and he's resting. Here comes the buyer.

He barely makes it a higher high. He's resting. Resting, resting.

Oh, what happened to my buyer? He's dead. Okay.

He's dead. He's back down to the same area again. Would you say this is a good support equals resistance.

Extend that out. You are preparing for any pullbacks for cells. This is the way You want to understand of how do I need to get in.

When do I need to get in and how much data do I need to use? Now, if you look at it based on a 15 minute look how much data you're using here on the 15 minute. now you know why you're using that much data, correct?

But on the higher timeframe, don't look at that much data. Then you're involving stuff that you don't even want to be involved with. I hope this was a good day and you guys had some breakthroughs.

Thank you. And I love you guys too. Cheers.

Bye for now.