(Title)
Breakout trading starts with finding support and resistance points
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I will take the time to talk about breakout trading.
This is my opinion, so the content may be lacking.
The reason I did not explain what other people say with examples is because trading is a psychological battle.
Most of the content in books or on the Internet is explained with patterns.
However, it is not easy to find patterns when checking the movement of a real-time chart.
Therefore, I think it is more important to understand why such movements occur than to explain them with patterns.
Therefore, I think it is better to create a trading strategy by finding support and resistance points and checking whether or not they are supported by the support and resistance points rather than memorizing patterns.
Breakout trading refers to starting a transaction after checking whether there is support at a point or section when the price rises above a certain point or section, and there is a possibility of a larger rise.
If you do a breakout trade incorrectly, you may end up buying at a high point, which could result in a large loss, so it is recommended to always keep a stop loss point when trading.
In order to reduce the stop loss, you need to make an effort to lower the average purchase price by selling in installments when the price rises after purchasing and buying in installments when the price falls again.
Therefore, the stop loss point is when it is beyond the range you can handle.
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Let’s take the BTCUSDT 1D chart as an example.
It has fallen after renewing the ATH.
Looking at the current price position, it feels like it will fall further.
However, if the price rises to around the HA-Low indicator on the 1D chart, that is, around 89294.25, you will feel like it will turn into an uptrend.
Even if you think that you won’t feel that way now, you will feel that way after it rises.
Therefore, the most important thing in breakout trading is to find important support and resistance points.
To find support and resistance points, you need to basically understand candles.
Any book or video about candles will do.
I recommend that you don’t try to memorize the content in it, but read or watch it repeatedly several times.
In my case, after watching the video about candles about 3 times, my understanding of the chart became easier.
The reason for finding support and resistance points is to select a trading point.
What you need to find support and resistance is a horizontal line.
It is not easy to start trading with chart tools that are not horizontal lines but diagonal lines or curves.
The reason is that when you try to start a trade, you are more likely to miss the timing because your psychological state is added.
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You can see that the uptrend started when it broke through the 73072.41 point.
Therefore, you can see that it is possible that the uptrend will start when it breaks through the 106133.74 point this time as well.
However, in this case, since it is rising while renewing the ATH, it is a point where it is thought to be difficult to actually start trading.
In other words, it is likely that you will be reluctant to trade because it is thought to be a high point.
Therefore, as I mentioned earlier, the actual breakout trade will be conducted when it breaks through the 89294.25 point.
Then, even if it rises to around the 106133.74 point, you will be more likely to respond stably without feeling much psychological anxiety.
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However, there is one problem.
That is, the StochRSI indicator is currently in the overbought zone.
Therefore, when it rises near the 89294.25 point and confirms support, the StochRSI indicator should show a downward trend from the overbought zone.
Otherwise, the 89294.25 point is likely to act as a resistance point.
Even if the market is messy and difficult to predict, you should not be too busy finding support and resistance points.
After all, you need to have a standard for creating a trading strategy to start trading.
It is better to create a trading strategy and respond at the support and resistance points you have selected if possible.
Even if you suffer a loss, if you continue to trade, you will be able to better organize the support and resistance points.
For reference, the indicators that can create a trading strategy on my chart are the HA-Low and HA-High indicators.
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Thank you for reading to the end.
I hope you have a successful trade.
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