Simple Forex Trading System Based on Support and Resistance

Another Forex trading system which can be used for learning material and practice is Forex trading system using support and resistance levels. If you have not learned about support and resistance method, you can also search support and resistance in this blog.

In this simple Forex trading system, we will going to use support and resistance which determined by horizontal line at high and low candlestick charts.

Open your trading chart, I recommend to use 1 hour time frame chart or 4 hours time frame chart. These time frames are my recommendation, but if you like another time frame chart you can use it.

To identify the resistance area, look at the highs on your candlestick chart and then connect them with horizontal line using trendline tool. And to identify the support level area, look at the lows on your candlestick chart and then connect them with horizontal line using trendline tool.

Trading rules for Simple Forex trading system based on Support and Resistance levels.
- If the market price broke the resistance line more than 40 pips, then you can consider the resistance has changed changed into support level.
- Ehrn the market price broke the support line more than 40 pips, then you can consider the support line has changed into resistance level.
- Only open buy trading position on the support levels
- Only open sell trading position on the resistance levels
- Use less than 30 pips for stop loss
- Use more than 30 pips for profit target, I suggest to use at least 1:2 risk and reward ratio.
- Trading pair : any

The thing that you should keep remember is the market price can break the support and resistance level anytime, that's why you must use the stop loss order in this trading system.