Quarterly high and low as resistance and support levels for traders
Quarterly highs and lows are resistance and support levels that traders need to look out for. Other resistance and support come from these and many other levels:
- 52-week or yearly highs, lows
- Month highs and lows
- Week highs and lows
- Day highs and lows
This is easy to understand – recall the concept of candlesticks. If candlestick highs and lows are valid resistance support and candlesticks are based on time periods, then… you get the point.
Traders might want to take note that support resistance based on previous periods are reliable for one reason – they do not reprint.
Application should be personalised. If you are investing or trading on high time frame, levels on the lower time frames might not be important. If you are a day trader doing intraday, then obviously the highest and lowest traded price the day before as well as last week are very important.
Back to quarterly highs and lows, these two charts below illustrate HSI and SGFREE (SiMSCI) clearly reacting to highs and lows of previous quarters.
Additionally, these posts tackle the same topic:
- Forex pairs reacting to 52-week highs and lows
- 6 tips to use weekly highs and lows as an indication of trend
- *Don’t miss this piece because it was just captured 2 weeks ago* How the market flushed EURUSD traders in the last 12 weeks at the highs and lows and how you can convert that to your own trade signal
Note: Breaking charts into time period based boxes like quarter, month, week and so on is very useful for new traders. When we taught classes for basic technical analysis, we used to tell participants to look for support and resistance at turning points. Whenever this comes up, they give us the blank look “where?”
We point “there“, they nod their heads but 2 weeks later they come back and tell us there is a problem.
“Well we thought we understood perfectly during class but when we pull out a chart at home, there are obviously so many turning points so we don’t know which to use“.
Not every turning point is going to be a significant support resistance but the moment you organise your chart into time periods, everyone starts to see it better. Instead of just a turning point, they internalise what they want to do and then straightaway, they know where to look – like is it the low of last month or the month before, did this break the low of yesterday or go back to the high of last week.
Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.
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