Contrary to popular belief, the more a price touches support, the WEAKER it becomes.
I'm seeing lots of charts lately that make this mistake.
Here's a short thread why this is the case:
Price bounces at support because there are buyers willing to pay at that price.
Due to what's called "order absorption", each following support touch will usually have less and less buyers, eventually causing a shortage of buyers at a given price.
This is when price falls
An easy way to think of it:
Imagine a ball bouncing off the floor... With every bounce, it gets weaker and eventually stops bouncing.
Once it stops bouncing, the ball is no longer in motion, AKA the price will break through support
I'm seeing lots of charts lately that make this mistake.
Here's a short thread why this is the case:
Price bounces at support because there are buyers willing to pay at that price.
Due to what's called "order absorption", each following support touch will usually have less and less buyers, eventually causing a shortage of buyers at a given price.
This is when price falls
An easy way to think of it:
Imagine a ball bouncing off the floor... With every bounce, it gets weaker and eventually stops bouncing.
Once it stops bouncing, the ball is no longer in motion, AKA the price will break through support
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.