Understand the Basic Idea of the Resistance Level and How the Price respects the identified Resistance Zone

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Assalam-o-Alaikum Steemians !

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I'm @moneyster, a professional level Cryptocurrency investor and an analyzer. As usual, today I thought to share another Crypto-related experience with you. I hope this article will be considerably beneficial for all the Steemians in this community

What is this Resistance Level and how to find it?

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The resistance level can be defined as a better zone to sell our assets at the right time in accordance with the other suitable confirmations. However, identifying a proper resistance zone is the most important thing that should we focus on before placing a sell entry.

To identify a proper Resistance Level, we should be attentive to the historical price data in a relevant chart asset. Furthermore, here we can find previous highs or higher highs and write a trendline by connecting them together. At the same time, we can extend that line to the front side of the chart window to predict future market behavior.

After extending the selected Trendline to the front side of the chart window, we can carefully focus on that line for a suitable rejection of the current bullish price movement. Then, we can take our entry when the second bearish candle breaks the low of the first bearish candle.

At the same time, we ca n place our stop-loss point to the Upper wick of the last bullish candle that we can see at the top of the selected resistance zone. Here we can also use Moving Averages and Exponential Moving Averages to confirm our entry when working with resistance zones.

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What are the benefits of following the Resistance Level in a chart?

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As I said before, identifying a proper resistance zone is a quite difficult but higher beneficial task in technical analysis. With the help of this Resistance Level, we can take a better opportunity to sell our assets at the right time and right place. And also, here we can take better Trading Opportunities such as short entries with a better reward ratio. However, placing a stop-loss zone is quite close compared to other trading strategies. But the risk-to-reward ratio is very good in this resistance zone trading strategy.

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How to analyze our Crypto Charts Practically with the help of Resistance Level and How the Price respects the identified Resistance Zone?

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First of all, I will open BTC/USDT chart using the TradingView platform. Then we need to find the Resistance Levels in the chart using the candlestick chart by comparing historical data with its highs and higher highs. Then, we need to draw a proper horizontal line by connecting those Highs or Higher Highs together.

We can easily extend that horizontal line to the forward of the chart window to get an idea of the future market behavior. So, the price should show a significant rejection from this highlighted zone and a [proper bearish candle should be formed near this Horizontal Line. Here the next candle after the bearish candle should be another bearish candle and it should break the lower wick of the first candle that had been trading near the resistance zone to take our entry. I will further demonstrate it through the BTC/USDT chart.

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In this way, we can easily use this Resistance Level in the chart and take more accessible trading opportunities. However, we can try to combine this strategy with some other indicators to increase the winning percentage.

At the same time, as I said in my previous article, we should remember that all the indicators and strategies are not efficient completely as nothing we can find 100% efficient in the world. So, we should depend only on these strategies and indicators to confirm our trading opportunities.

I have studied the below-sourced articles to study these topics further, and I have explained all the above facts in my own words and experience.

• Source 1

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Thank you all....!