Question: How do I determine the support and resistance level on a currency chart? My understanding is that you use a weekly or monthly chart to determine resistance and use the 4-hour or 1-hour chart to determine entry point. Is this approach correct?
Ed from Weeklyville
Ed, this is a simple answer, sort of … If it works for you, it is correct.
Technical analysis is a world filled with myriad tools for detecting market movement. Resistance, bottoms, entry, and exit are concepts that fit quite neatly into that world. Charts, of course, are the medium of technical analysis. Given just these facts, one could reasonably state that it could take quite some time to learn all the possible ways to determine support and resistance levels on a currency chart. The possible permutations are endless. You have asked me about one of those permutations.
Implicit in your question is the lack of trying your approach. If you had tried it, you would know the answer and you would not seek advice from me. My advice to you is that you learn your chosen approach well, try it for a period of time, and then determine your answer based on the success (or lack of) of your trading. Trade in the day; invest in your life …