Hi, everybody, I'm Marina, the trader chick, and today I want to talk about support areas, specifically areas in general in a market, and when you're reading charts or regardless of what you are trading, regardless of the financial market that you are trading, they are crucial for you to know and understand support areas, also resistance areas. And if you don't know what to look for and where they are, you might constantly be making the wrong decisions by getting into wrong markets where there are these strong areas.
What does support mean in trading?
So today we are going to talk about what is a support area. And if you have a defined area in this particular case, a support area, you want to be very, very cautious and cognizant of those areas. And normally when you have a pretty significant trend support areas, they could turn into channeling margins, which is consolidation areas, exhaustion periods in decision areas. But if you do not have your area drawn in, and you want to be able to draw it in, so it's all about what can happen in the market, not so much what did, but what can.
And when you have an area, there's a potential that it can hit that area again. If you do not know how to draw in a support area, that could be a real hindrance.
And you could actually start to lose money because you were believing that the market is continuing down. However, if you have your seatbelt on and if you hit another car or if you hit a wall, you are protected in your support area.