Skip to main content

Dynamic Support and Resistance

Dynamic support and resistance

We have discussed in previous posts about horizontal support and resistance, how to draw it. We also discussed how a gap can act as support and resistance in previous post. Today we are going to discuss about dynamic support and resistance.

What is dynamic support and resistance

Dynamic support and resistance are not like horizontal support or resistance. They are constantly changing. We can use moving averages as dynamic support and resistance. We have done some videos about moving averages. You can check those videos in our channel.

You might have noticed price bouncing once it touches a major moving average from upside. Same thing happens when price rise and touch a major moving average line below. In the image below moving average acts as support each time price goes down and bounces from there.

                                     

Consider as zones 

As I said in previous posts, always consider support and resistance as zones, not a fixed point. These can be considered as areas of interest for buyers and sellers and it wont be an exact point. It will be a zone or area. In the image above itself you can see price going through moving average a bit and coming back. 

Watch video below from our channel share market Malayalam to know more about this.



Moving average trading strategy


We can use this concept to make trading strategies. You just need to select right moving average based on your trading duration and back testing. I personally use 20 EMA or 50 EMA for trading. You can back test yourself and find best combination based on your trading style.

I have said earlier that sometime price may go through moving average and comeback. Considering this some traders use a combination of two moving averages and consider zone between them for buying or selling of shares.
Eg : a combination to 10 and 20 EMA. They buy when price reverses from a zone between them.


OPEN UPSTOX ACCOUNT

upstox

OPEN FYERS ACCOUNT


fyers

Support Resistance role reversal

As in the case of horizontal support and resistance dynamic support resistance also reverses its role. Moving average once acted as support is broken, it acts as resistance and vise versa. You can see that in image given below. Moving average which was acting as support till its broken. Once its broken and when price retraces it started to act as resistance.




Check All posts in support and resistance series 

We have done 4 videos about support and resistance. I will update this list once I add more.


Comments

Popular posts from this blog

Upstox Pro discount broker All you want to know

Upstox Pro Upstox is a leading discount broker in India and one of the fastest growing discount broker. Ratan Tata invested in this company a few years ago. Recently Tiger global invested 25 million in upstox. It is growing fast with cutting edge technology and low brokerage and gaining market share. Upstox added 1 lakh clients in December month 2020 only. They are providing some of the best trading platforms for traders and investors and making it better with frequent updates. Upstox pro is upstox web trading platform.
How to open demat account in upstox or upstox account opening process To trade in share market or commodity or currency market, you need a trading account. To buy and hold a share in share market you need a demat account also. You can easily open your trading and demat account with upstox by filling their account opening form. Link is given below. 
Upstox account opening process is completely online and you can open trading and demat account in a few minutes by going t…

Fyers Account opening to trading platform review

FYERS All you want to know Fyers is one of the youngest discount broker in India found by 3 brothers. FYERS word is acronym for Focus Your Energy and Reform Yourself.
Fyers is a Bangalore based company. Their aim is to provide best technology platforms to traders in India. I think they succeeded in it to a point. They have one of the best platforms for web, desktop and mobile. We will discuss about fyers trading platforms in detail later.
Here we discuss few things about this discount broker, ranging from account opening process, trading platform, brokerage and thematic investing.
Fyers account opening process Fyers account opening process is completely online. You can open trading and demat account online by filling online account opening form in this link : Fyers

Form filling is a simple process. You can refer this video to fill fyers account opening form.

OPEN FYERS ACCOUNT 




Documents needed for account openingPAN Card (Mandatory)ID Proof - Voter ID, Aadhar card.Address Proof - Passpo…

Commodity trading in India

COMMODITY TRADING IN INDIA WITH MALAYALAM VIDEO You can find commodity trading malayalam videos below this post from our youtube channel  Share Market Malayalam.  Commodity trading in India may not be as popular as stock market trading in India. Its gaining popularity in India now and a lot  people started trading in mcx commodities now. Here we discuss some basic things related to commodity trading and commodity market in India.  Forward contracts of commodities are traded in commodity exchanges. Future and options segment is highly leveraged trading intruments and a beginner should first learn and then only trade in commodities. A lot of beginners in trading gamble in commodities like crude oil and lose money. Some go for tips. But that is not a permanent solution. Learning to trade is always better than going behind tips for commodity trading. To be successful in trading, you need to learn technical analysis and develop other skills also which are needed for a trader to be successf…