The Real Rayner Teo

2024-03-02 15:32:39 How to Draw Fibonacci Retracement: A Step-by-Step Guide for Traders

Learn More https://www.tradingwithrayner.com/how-to-draw-fibonacci-retracement/

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2024-03-02 04:01:13 [Support could become resistance, why?]

There are two reasons for this…

Reason #1: Losing traders hoping to get out at breakeven

Support is an area where potential buying pressure could step in and push the price higher.

However, support doesn’t always hold.

When it breaks, those traders who are long will be sitting in the red. The smart traders will cut their losses and move on. But, stubborn traders will hold onto to their losses and hope the price will reverse back to their entry price — so they can get out at breakeven.

So if you think about it, this group of stubborn traders will create selling pressure at their entry price as they exit their positions, and if there’s enough of such traders, support will become resistance.

But that’s not all because…

Reason #2: Textbook setup

Traders familiar with classical technical analysis will look to sell at the previous area of support as that’s what most textbooks teach.

And if you get enough traders “following” the textbook setup, it puts selling pressure on the previous area of support which could now become resistance. Open / Comment

2024-03-01 04:00:35 In trading, you're not paid by the hour but, by doing the correct things over and over again. Don't forget that! Open / Comment

2024-02-29 15:37:45 This is a 31-page trading booklet that contains a specific trading system that has generated 1451.74% since 2000—and has 18 winning years out of the last 20.

Learn More https://pullbackstocktradingsystem.com/ Open / Comment

2024-02-29 04:00:25 [Why support and resistance are not lines on your chart]

Let me share with you a story…

In my early days of trading, I used to think my support and resistance lines are the best and the market will respect it to the pip.

But it didn’t take me long to realize my support and resistance levels keep getting breached, and I thought it was a breakout.

So I traded the breakout.

The next thing I know, the price quickly made a swift reversal in the opposite direction and I got stopped out.

So, I looked back at my charts and asked myself:

“What the hell went wrong?”

Well, it seems the levels I drew did hold up, albeit not to the exact pip.

And that’s when I had an “Aha!” moment…

I realized support and resistance are not lines, instead, they are areas on my chart. Here’s why…

There are usually two groups of traders in the market:

- FOMO traders
- Cheapo traders


I’ll explain…

Traders with the fear of missing out (FOMO) would enter their trades the moment price comes close to support.

And if there’s enough buying pressure, the market would reverse at that location.

On the other hand, some traders want to get the best possible price (cheapo traders), so they place orders at the lows of support. And if enough traders do it, the market will reverse near the lows of support.

But here’s the thing:

You’ve no idea which group of traders will be in control. Whether it’s FOMO or cheapo traders.

Thus, support and resistance are areas on your chart, not lines. Open / Comment

2024-02-28 15:38:55 Limit Order vs Stop Order: Which one Should You Use And Why?

Learn More https://www.tradingwithrayner.com/limit-order-vs-stop-order/

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2024-02-28 04:01:05 If you manage your risk, your profits will take care of itself.

If you don't, your parents will take care of you. Open / Comment

2024-02-27 15:29:27 Triple Bottom Chart Pattern (The Essential Guide)

Learn More https://www.tradingwithrayner.com/triple-bottom/

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2024-02-27 04:00:00 [This is the most important technical level one the chart]

Here are a few reasons why…

Reason #1: Losing traders hoping to get out at breakeven

Multi-year highs represent extreme optimism in the markets because most traders (and investors) are in profits.

But as you know, the price cannot go up forever. Eventually, it has to retrace or reverse altogether.

When that happens, many traders will exit their long trades.

However, not everyone will do the same. Some will continue holding, hoping the price could breakout higher to give them even more profits.

But when the market collapses even lower, they’ll regret not selling earlier as their open profits have been eroded and they are now sitting on their losses. They hope the market could re-test the highs so they can get out of their trades at breakeven.

Reason #2: Bearish traders looking to short the markets

For bearish traders, multi-year highs present an opportunity to short the market at a “high price” because they can reference the highs to set their stop loss.

So as the price approaches multi-year highs, the short interest from bearish traders will increase.

Reason #3: Momentum traders looking to buy breakouts

Momentum traders buy breakouts as the price moves above a certain level. It could be breakouts of a range, swing high, resistance, etc.

But what’s interesting is if the price breaks out of multi-year highs, it’ll attract attention from traders across different timeframes.

That’s because whether you’re a day trader, swing trader, long-term trader, etc. the multi-year highs will be something visible on your timeframe (and charts).

Now, whether you’re bullish or bearish, multi-year high is a significant level for traders.

If you’re bearish, then you can reference it to set your stop loss above the highs.

If you’re bullish, then you can look to buy the breakout and have your stops below the previous multi-year highs (anticipating that it could become previous resistance turned support).

(And vice versa for multi-year low.) Open / Comment

2024-02-26 04:01:50 No one can consistently predict the markets, call tops and bottoms.

So just follow price. Ride winners. Cut losers.

You'll be much further ahead than trying to outsmart the market. Open / Comment