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TA Challenge: Chart to find breakdown stocks
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steady Pom pipi joined discussion · Oct 4, 2022 10:47

Finding support and resistance levels

For support and resistance levels, I think they can be understood like this
1.之前股票价格的低点为支撑位。
2.当股票价格来的高点后回落，这时我们可以把高位的股票价格当成阻力位。
3.当股票价格突破阻力位之后来到另外一个高点，这时之前的阻力位变成了支撑位，而新的高点变成了新的阻力位。
4.当股票价格突破阻力意味着股价继续上涨的趋势非常大，相反的当股价跌破支撑位意味着股价继续下跌的趋势非常大。
练习案例：
这里我使用了  $Global X Nasdaq 100 Covered Call ETF (QYLD.US)$ 的周K线来解说：
先看图表再看解说会比较容易明白一些
Finding support and resistance levels
A-1 is the previous low point, which we can consider as a support level. You can see that the stock price did not fall below 1 and continued to rise.
B-When the stock price continues to rise to a new high of 3 and then falls back, we can consider 3 as a resistance level.
C-When the stock price falls back to 2 after reaching the resistance level and retests the previous support level of 1.
D-When the stock price breaks through the resistance level, it means that the stock price is likely to continue to rise. 3 and 6 are resistance levels, and you can see that the stock price continues to rise after breaking through the resistance level.
E-When the stock price breaks through the resistance level and continues to rise to another high point of 4, the new high point becomes the new resistance level, while the previous resistance levels (3 and 6) become the new support levels. (In fact, you can see on the chart that the stock price has tested the resistance levels of 3 and 6 multiple times before reaching '4'.)
F-When the stock price falls below the support level, it means that the stock price will continue to decline. When the stock price reaches the resistance level of 4 and retests the support levels of 3 and 6. When the stock price falls below the support level of 5, you can see that the stock price continues to decline. At this time, 5 becomes the new resistance level, and the stock price will retest the previous support levels of 1 and 2.
How to operate when the stock price reaches the support and resistance levels
After understanding the basic trendlines, let's dive deeper! Combine some technical indicators to determine how to operate when the stock price reaches support or resistance levels. Here I use the technical indicator MACD for analysis.
When the stock price reaches the resistance level of 3 and the technical indicator MACD is in a dead cross and starts to fall below the zero axis, the stock price begins to retest the support level of 2.
When the stock price reaches the support level, we can use MACD to determine the timing of buying. After the stock price rebounds from the support level of 2, a golden cross appears in the MACD, indicating a buying opportunity.
When the stock price returns to the resistance level of 6, you can find that MACD has crossed above the zero axis. At this time, the stock price breaks through the resistance level of 6 and continues to rise.
When the stock price reaches the resistance level of 4, you can find that MACD has diverged, indicating a potential reversal in the stock price.
When the stock price falls back to the resistance level of 5, you can find that MACD is now below the zero axis, indicating that the stock price has broken below the support level of 5.
Based on the current observation, MACD is still below the zero axis, so the stock price may retest the positions of support level 1 and 2.
Finding support and resistance levels
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steady Pom pipi
最渺小的我，有大大的梦😜
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