Forex levels.

It is the levels that are one of the main guidelines when opening new transactions on Forex; they show places on the chart, upon reaching which the price of a currency pair can change its behavior.

Forex levels are used in strategies such as trading on a breakout or reversal, trading in a price channel and some other options, the main thing is to choose the right level that is right for you.

Basically in trading, levels such as support and resistance, basic points, Murray levels and other similar options are used.

Each level is built on the basis of its own indicators, so to increase trading efficiency, it is advisable to use several options at once.

The ideal moment is when several levels coincide at once. There are two options for events when a significant price level is reached - a trend reversal in the opposite direction or a breakdown and its movement further.

The trader’s further actions usually depend on the scenario of events. 1. Support and resistance lines are familiar to almost any novice trader; read about them in detail at the link provided earlier.

These lines are constructed based on the price minimums and maximums for the selected time period. Support characterizes the minimum prices, resistance characterizes the maximum. 2. Basic points - in fact, these are some psychological marks that most Forex traders focus on.

For example, if for several months the price of a currency pair has not risen above 1.2000, then this value is a strong resistance level. The more often a reversal occurs at this mark, the more significant it is. It is round numbers that most often act as base points, but there are exceptions to the rules. 3. Overbought and oversold - although there are no clear boundaries here, there are still levels.

The main tool for building them is the Stochastic indicator, which is available in almost any trading platform. As soon as demand reaches its maximum, the market enters an overbought state, and vice versa, with a large number of sales transactions, an oversold state may be observed. In this case, the levels of these states can be 10 and 90 or 20 and 80, depending on the preferences of the trader. 4. Murray levels - in principle, this is one of the options for constructing support and resistance lines, only on the chart of a currency pair, not one, but several price channels immediately appear, and the wider the given channel, the more significant its boundaries are.

5. Other options - there are a lot of other options for constructing Forex levels; their calculations use such indicators as market opening and closing prices, the average price per day or session, and many other data.

The longer the price is held at a certain level, the greater its value and the more significant the movement will be after breaking through this border. In my personal opinion, the most significant of those listed are support and resistance lines and basic points, despite the simplicity of construction, trading using them more often brings a positive financial result.