There are many ways to use Support and Resistance Levels on our charts. The most simple and effective way to use this tool is by monitoring the Moving Average. The below chart shows price has is been in a long-term downtrend and this has been confirmed by multiple rejections at the Moving Average level.
Currently price has retraced back to the Moving Average level (Support). Based on our previous understanding we can anticipate price to form a rejection candle and re-join the downtrend.
Coffee has been in an aggressive downtrend for last 2 years and it does not look like it will be slowing down anytime soon. We will continue to patiently wait for price to breakout of Resistance Level 98.00.
Price has been trading below the Moving Average level which confirms we are currently in a downtrend. Price has attempted to breakout of Resistance level 0.96300, once this has been confirmed we will be joining the Bears on the downside.
Silver – Bearish
The price of Silver has continued to move lower and lower during the course of the year. Price is currently consolidating at 14.000 where a Bearish Flag Pattern has been formed. The Flag Pattern is a great Price Action tool to enter a trending market and also test whether the trend is still in play.
We will be waiting for a breakout to the lower side of the Bearish Flag.
EURGBP is currently trading above the Moving Average which confirms the Bullish trend. We have experienced a pullback towards the Moving Average, however price has consolidated around 0.89000.
Currently we are monitoring an Inside Bar pattern as there are 3 bars within the mother candle. We will be respecting the uptrend and be waiting for a breakout above the Inside Bars.