Grad Call Summary 10-23-08

Hey Gang,

 

In last nights grad call, we discussed support and resistance and their significance in this market environment.  Some great reading on support and resistance can be found at the following links:

 

http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:support_and_resistan

 

http://www.investopedia.com/articles/technical/061801.asp

 

 

When analyzing support and resistance(S/R), we need to keep the following in mind:

1. S/R are generally price ranges and not specific or exact price points. 
2. Volume is critical in determining s/r levels
3. Broken s/r levels are often retested. 

 

Take a look at a chart on the market right now and we can see the S/R forming.  Look to buy at support with a stop if support is broken.  Also look to sell at resistance or buy if resistance is broken.

 

 

 

Trading with support and resistance will help remove a lot of the frustration and inaccuracy of technical indicators in this type of market environment. 

 

Happy Trades,

Jeff