When the price in the investment market reaches a certain level, it often no longer continues to rise or fall. It seems that there is a resistance line that blocks or supports the price at this price level, which are called resistance line and support line respectively.
Both resistance and support lines are important methods of graphical analysis. Generally, if the price of gold fluctuates up and down in a certain area, and the accumulated volume in this area is extremely large, then if the price of gold rushes or falls below this area, it will naturally become a support or resistance line. These once high-volume price levels often change from resistance to support or from support to resistance: once the resistance line is crossed, it becomes the support line for the next downtrend; once the support line is broken , will be the resistance line for the next rally.
When investing in spot gold , it is very important to find the support and resistance levels of the market. What are the methods for finding support and resistance?
Support and resistance levels are extremely important points in the market trend, and can also be called the potential inflection points of the market. Taking support as an example, in a falling market, when the price encounters the resistance of the support, there will be a rebound or reversal, which depends on the performance of the price after it hits the support. But under normal circumstances, it will not directly fall below this position, especially the first or second touch, the effect of resistance is the same.
There are many ways to find support and resistance in the process of frying gold , and there are many tools to use. The commonly used indicators are K-line, moving average, trend line, channel line, golden section line, etc.
Looking for support and resistance through the K-line is the most common way. Generally, you can refer to the high point or low point of the price in a period of time. The high and low points are usually the support and resistance after the price touches again, and there will be significant resistance. Effect. In addition, the physical coincidence position of the two K-lines is also a very important inflection point.
- Moving Average
Taking the 5-day and 10-day moving averages commonly used by investors as an example, in a rising market, the two moving averages are upwards. When the price pulls back, both the 5-day and 10-day moving averages are likely to become obstacles. When it falls below the 5-day moving average, the 10-day moving average below will have a support effect.