During the trading process, identifying resistance and support levels is fundamental!
1. Previous high points are resistance levels, and previous low points are support levels. If the previous high point is broken, it becomes a support level; if the previous low point is broken, it becomes a resistance level.
2. A dense trading area of oscillating chips is a support level above it and a resistance level below it.
3. A trend line connecting two low points is a support level; if broken, that line becomes a resistance level. A trend line connecting two high points is a resistance level; if broken, that line becomes a support level.
4. On moving averages, the moving average is a support level; below the moving average, it is a resistance level.
5. A large bullish candlestick with increased volume has its bottom as a support level. If broken, it becomes a resistance level. A large bearish candlestick with increased volume has its top as a resistance level; if surpassed, it becomes a support level.
Both support and resistance levels should be considered in conjunction with trading volume. As long as there is an increase in volume, both support and resistance levels can become invalid.