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Creator: Grow More
Source: https://www.youtube.com/watch?v=qMLwSTqBT9o
Type: #litnote 
Topics: [[💹Stock Market]] [[Other/Obsidian Starter Vault(Second Brain)/003 RESOURCES/Trading]]



# Horizontal support and resistance
# Trending support and resistance

# Breakout of Trending support and Resistance
# Breakout of Horizontal Support and Resistance

> Tip: Look for volume supports and candlesticks

## Steps to Use Support and Resistance Effectively
- **Identify the candidate: ** Find  stocks that have strong support and resistance. The stronger the support and resistance, the better is the outcome
- **Wait for the breakout**: Wait patiently to see the market make a move. See if it is a breakout or fakeout. Consider the volume of trade before making your move.
- **Have a Plan**: Before making a trade, have a reasonable expectation of where you will exit the trade. 
- **Allow the stock to retest**: After breakout, old resistance becomes support and old support become resistance. In majority of trades, the stock will test the level it has broken after the couple of days. Prepare for it.
- **Know when your Strategy has failed**: Maintain discipline. You have to have a mentality to accept the loss if your trade strategy doesn't work. Put stop loss to your trade to minimize loss.