Trading the financial instrument can be a very challenging task especially if you are relatively new in this industry. Professional options traders have been trading the financial instrument and making a consistent profit simply by using the key support and resistance level. Though there are many different ways of trading the financial instrument but price action trading strategy tends to create the most reliable and profitable result in the market. If you truly want to become successful in this industry then you must know how to draw support and resistance level in the market.
Let’s see how the professional traders use different candlestick pattern at the key support and resistance level to trade the financial instrument.
In order to trade the financial instrument with this trading strategy, you must know how to draw support and resistance level properly. A key resistance is such a level which restricts the bullish momentum of the currency pair. On the contrary, the key support level restricts the bearish move of the currency pair and creates new bullish momentum in the market. Support and resistance level are drawn with the help of horizontal line in the chart. In the above figure, the red lines are the key support and resistance level in the price which gives the traders unique options trading opportunity. In order to draw a valid support or resistance level, you must have at least minimum of two connecting points in the market.
Professional options traders use high reliable candlestick chart pattern to trade the important support and resistance level of the currency pair. In the above figure, the put option order was executed in the market when the price formed a bearish pin bar right at the key resistance level. The blue shaded region is the place where the trained option traders executed their put option order the market. Advanced option traders also execute no touch option order in the market with such bearish pin bar confirmation. In such type pattern, price rarely goes above the tail of the pin bar giving the no touch option zone to the trained professionals. The second entry was call option in the market. With the formation of the bullish morning star pattern traders executed their call option order right at the key support level in the market. No touch option order was also was executed by the advanced options traders in the since expert option traders knew that price has very less chance to breach the low of the morning star candlestick pattern. Though the system is extremely reliable and simple yet traders are advised to use proper risk management factors while using this strategy.