Poetry, Tea, and Gold: How to Look at Support and Resistance Levels in Gold Investment Trading

Life is so simple, if you can't find a reason to persist, then find a reason to start over. Laugh at life, all the beauty will come to you. There is no way out, and there will always be a dilemma on the road of investment. If you accidentally change your mind, you may understand that there is still a road next to it, and after losses, only the path of profit remains. Choose a good direction, and on this road, you will achieve twice the result with half the effort. Gain calmly, lose calmly, strive for inevitability, and let nature take its course. I am Shi Ming Pin Jin, no matter where you are, I have been waiting for you.

　　goldTo achieve stable profits in investment, one must be good at analyzing the trend of the market and follow the trend. Among them, resistance and support are the most common and frequently used auxiliary indicators, which are the two manifestations of price fluctuations. How to specifically identify support and resistance levels?


The price trend chart is a clear evidence of the power comparison between the long and short sides. When the power of multiple parties is strong, they move upwards, and when the power of the short side is strong, they move downwards. That's it. It's like climbing and skiing alone, encountering obstacles that affect the upward speed;When skiing, one may encounter resistance that prevents them from sliding down, leading to resistance and support.


　　What is resistance level?Places with strong bearish forces and weak bullish forces naturally form resistance levels. In practice, due to the consensus of public expectations, the following areas often become obvious resistance areas:


　　1The opening of the index on that day was lower than the previous closing. In the process of climbing up, there will be resistance here, because after a night of thinking, both the long and short sides have reached a consensus on the previous closing price. When the day opens, there will be previous closing prices participating in bidding trading. If the index opens low, it indicates strong selling intention. During the rebound of the index, on the one hand, it will be hit by new selling at any time, and on the other hand, as it approaches the previous closing, the accumulated selling in the morning will take effect, making it easy for bulls to pass this hurdle.


　　2After the opening of the day, it fell. Due to the accumulation of a large amount of selling at the opening price during bidding, there will be resistance when rebounding back to this point.


　　3The reason for the formation of the previous high is because there is a clear backlog of selling here. When the index encounters resistance and falls again, once it approaches the previous high, new short selling forces will intervene, and bulls will become cautious. A clear pattern is formed on the trend chartMHead shape, and most of the time the high point on the right will be lower than the high point on the left.


At the same time, due to people's psychological influence, some integer values often become important obstacles when rising.


The purpose of identifying resistance zones is to sell at the highest or second highest point, and it is generally possible to sell before entering the identified resistance zone to increase trading opportunities. Or when the index falls from a high point and approaches this high point for the second time, sell it. The support level refers to the area where the price cannot fall. Common support levels include the following categories:


　　1If the price rises after the opening and falls back to the opening price, the support will be stronger due to more buying sedimentation.


　　2If the index falls from a high point in the previous closing, the support at the previous closing is also strong.


　　3Front low point. The low point area formed last time usually becomes people's psychological support, and its principle is the same as the resistance area.


　　4The previous high point had significant resistance, but once it is effectively crossed, there is usually support when it falls again due to the accumulation of buying demand.


Identifying the support level is to strive to buy in the low zone. From the above analysis, it can be seen that support and resistance are a pair of contradictions that can be transformed into each other. When the original resistance level breaks through, it can become a support level in reverse, and when the original support level breaks through, it can also become a resistance level in reverse.


Grasping the support and resistance levels helps to analyze the overall market. For example, when crossing the resistance zone, it indicates that the market is very strong and can be bought or sold;When falling below the support zone, it indicates that the market is weak and can be sold or not bought.
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