Forex trading is a combination of different factors and understandings of the market. Many people who think about forex trading as a get-rich-quick scheme get literally shocked seeing the complexity of this market. Without proper preparations and a decent amount of learning about various forex-related subjects, it will be that much harder to read the market’s movement.

One of the indicators or technical pointers that I personally think every trader should know is support (and resistance). When you see a pair gong down and then bounce back up after hitting a certain level, then do it all over again only to bounce back up at the same level, you are probably seeing a support level. Resistance is for the upper barrier. In normal market condition, the distance between support and resistance will be at around 40-60 pips and more. If you are seeing forex trading from the right perspective, you must have already notice how calculating and reading support and resistance can help you make profitable trades.

A good rule of thumb is to buy at support and sell at resistance. When a pair hits its support, especially a strong one, you know that it will bounce back up for several pips. Depending on the strength of the market, you can get 20 pips easily using the support and resistance theory. Combine it with other indicators and you have a strong trading system in your hands. Now that you know how reading support and resistance can benefit your trade, you can use it as part of your overall trading strategy.