{"id":9759,"date":"2011-10-10T21:20:59","date_gmt":"2011-10-11T01:20:59","guid":{"rendered":"http:\/\/club.ino.com\/trading\/?p=9759"},"modified":"2011-10-11T09:23:10","modified_gmt":"2011-10-11T13:23:10","slug":"how-to-determine-where-the-real-support-and-resistance-are-everyday","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2011\/10\/how-to-determine-where-the-real-support-and-resistance-are-everyday\/","title":{"rendered":"How to Determine Where the Real Support and Resistance are Everyday"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignleft\" src=\"\/img\/sites\/ino\/email\/2466.jpg\" alt=\"\" width=\"200\" height=\"150\" \/>If you follow our blog, then you are definitely familiar with trader   Larry Levin, President of Trading Advantage LLC. We have gotten such a   great response from some of his past posts that he has agreed to share   one more of his favorite trading tips as a special treat to our viewers.   Determining the direction of the market can be tricky and just plain   confusing at times, but Larry\u2019s expert opinion keeps it simple and   straight-to-the-point. If you like this article, <a href=\"http:\/\/www.tradingadvantage.com\/Trading-Tip-v1\/landingpage.php \" target=\"_blank\">Larry\u2019s also agreed to  give you free access to one of his top trading secrets.<\/a><\/p>\n<p>Today he's going to tell you where\u00a0 the real support and resistance levels are everyday.<!--more--><\/p>\n<p>&nbsp;<\/p>\n<p>Understanding  support and resistance levels is an extremely important technical skill  in any market, and I think it's absolutely critical if you plan on  trading the S&amp;P E-Mini market. Professional Floor Traders are aware  of an entire range of major and minor support and resistance levels  before the market opens each day. They also know how to calculate new  levels as the trading day progresses.<\/p>\n<p>Support  is the price area for a potential bottom where the market will be  buoyed up as buyers come in seeing potential value. Resistance is the  price spot where the market just can't seem to move any further as  selling comes in every time it hits that level.<\/p>\n<p><strong>Knowing those points where the market may turn gives you an effective road map to guide you through the day.<\/strong><\/p>\n<p>Most  traders calculate support and resistance levels incorrectly, and to  make their job even harder, they generally don't know how to trade  around them. Many traders will use an old high or an old low and assume  they've found support or resistance. That just doesn't work. Think about  it for a moment. If the market always stopped at old highs we could  never have an up trending market, and if the market always stopped at  old lows we couldn't have a down trending market.<\/p>\n<p><strong>These Are the Same Numbers I (And Other Pro Traders) Use Every Morning <\/strong><\/p>\n<p>In  my training programs I like to focus some attention on the information  needed to correctly calculate support and resistance levels before the  open each day. These are the same numbers I and many other floor traders  utilize each morning. Can you imagine the \"edge\" this information gives  you for planning your possible trades?<\/p>\n<p>Let's  face it; all traders likely want to catch the big trending days, days  when the S&amp;P moves 15 or 20 points without looking back.  Unfortunately those big trending days just don't happen that often. Most  days it appears the market doesn't trend very much in either direction,  instead it will move between known support and resistance levels.<\/p>\n<p><strong>Knowing  the location of these price levels is important, but knowing how to  trade around them can be the difference between success and failure.<\/strong><\/p>\n<p>One  of the simplest ways to do technical analysis is by using the pivot  points. This method has been around for years and is described below:<\/p>\n<p>A  pivot point is approximately the center of today's price range. From  there, I calculate three different sets of highs and lows.<\/p>\n<p>These pivots are then potential support and resistance, when prices have gone outside the Value Area.<\/p>\n<p>Pivot Point = (High + Low + Close) \/3<\/p>\n<p>#1 high pivot = Pivot Point + (Pivot Point - Low)<br \/>\n#1 low pivot = Pivot Point - (High - Pivot Point)<br \/>\n#2 high pivot = Pivot Point + 2 (Pivot Point - Low)<br \/>\n#2 low pivot = Pivot Point - 2 (High - Pivot Point)<br \/>\n#3 high pivot = High + 2 (Pivot Point - Low)<br \/>\n#3 low pivot = Low - 2 (High - Pivot Point)<\/p>\n<p><strong>This is easy to do by hand every day, after the market closes, so you are ready for the next trading day <\/strong><\/p>\n<p>Most  trading platforms automatically calculate these numbers for your easy  retrieval and use. I do not use the pivot number for trading; I only use  it to determine the \"sets\" of pivots. I also do not use the #1 high  pivot as support, if the market opens or trades above it. I use them as  \"envelopes\". Let's say the market opens above the #1 high, I'll look at  the #1 low for support and the #2 high for resistance.<\/p>\n<p>In  my own experience, I have noticed that the #1 pivots work the best over  time. If the market gaps over the #1 pivot high, you'll have a #2 and  #3 to work with. You can either use limit orders to buy or sell at these  pivots and use a money stop, or wait for the pivot to \"hold\" the  market. If the pivot \"holds\" the market, trade an engulfment, doji-star,  tail or whatever you see, which is a more conservative entry.<\/p>\n<p><a href=\"http:\/\/www.tradingadvantage.com\/Trading-Tip-v1\/landingpage.php \" target=\"_blank\">Click here to see one of Larry\u2019s top trading secrets!<\/a><\/p>\n<p>Best Trades to you,<\/p>\n<p>Larry Levin<br \/>\nFounder &amp; President- Trading Advantage<br \/>\n<span \n                data-original-string=\"XDEH6XJ7CGm33VrZzZ2OM3uWcuNxeOQIeaVaLn8Rfwo=\"\n                class=\"apbct-email-encoder\"\n                title=\"This contact has been encoded by Anti-Spam by CleanTalk. Click to decode. To finish the decoding make sure that JavaScript is enabled in your browser.\"><br \/>\n        <span class=\"apbct-ee-blur-group\"><br \/>\n            <span class=\"apbct-ee-blur_email-text\">la***@tr**************.com<\/span><br \/>\n            <span class=\"apbct-ee-static-blur\"><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-init\"><\/span><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-soft\"><\/span><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-hard\"><\/span><br \/>\n            <\/span><br \/>\n            <span class=\"apbct-ee-animate-blur\"><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-init apbct-ee-blur_animate-init\"><\/span><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-soft apbct-ee-blur_animate-soft \"><\/span><br \/>\n                <span class=\"apbct-ee-blur apbct-ee-blur_rectangle-hard apbct-ee-blur_animate-hard\"><\/span><br \/>\n            <\/span><br \/>\n        <\/span><br \/>\n<\/span><\/p>\n<p>Disclaimer: Trading in futures and options involves a substantial  degree of a risk of loss and is not suitable for all investors. Past  performance is not necessarily indicative of future results.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<!-- AddThis Advanced Settings generic via filter on the_content --><!-- AddThis Share Buttons generic via filter on the_content -->","protected":false},"excerpt":{"rendered":"<p>If you follow our blog, then you are definitely familiar with trader Larry Levin, President of Trading Advantage LLC. We have gotten such a great response from some of his past posts that he has agreed to share one more of his favorite trading tips as a special treat to our viewers. Determining the direction [&hellip;]<!-- AddThis Advanced Settings generic via filter on get_the_excerpt --><!-- AddThis Share Buttons generic via filter on get_the_excerpt --><\/p>\n","protected":false},"author":41,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[7948,2913,4084,373,1585,306,3579,327],"class_list":["post-9759","post","type-post","status-publish","format-standard","hentry","category-general","tag-guest-bloggers","tag-larry-levin","tag-pivot-points","tag-resistance","tag-support-and-resistance","tag-support-level","tag-trading-advantage","tag-trading-tips-techniques"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v23.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How to Determine Where the Real Support and Resistance are Everyday - INO.com Trader&#039;s Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/wwwtest.ino.com\/blog\/2011\/10\/how-to-determine-where-the-real-support-and-resistance-are-everyday\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How to Determine Where the Real Support and Resistance are Everyday - INO.com Trader&#039;s Blog\" \/>\n<meta property=\"og:description\" content=\"If you follow our blog, then you are definitely familiar with trader Larry Levin, President of Trading Advantage LLC. 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