With all your new and incredible knowledge of technical analysis of Forex trading, what are you going to do with it? Sadly, it won’t get you a date nor can you use it to earn a break here and there in bar drinking games. However, the word break can help you to use your technical analysis. That’s because there are two ways you can make use of it. They are known as the bounce and the break.
Although we did just mention drinking games in a bar, this is actually The Bounce and not the Bouncer. The bounce is a method used in trading support and resistance levels following a bounce. The bounce is related to timing. You can jump right in or you can wait for the bounce to occur. Remember, your technical analysis will tell you when the bounce takes place that that would be your cue. Bouncing is good for several reasons and they have little to do with anything other than having fun. Just ask the neighborhood kids who keep bouncing around on a trampoline. There are always ups and downs. You can’t get away from them.
Remember, Forex trading has a lot of opposites included. The Break is one such example. This is essentially when support and resistance levels break. We know, it sounds far too simple to be true but it is what it is. The levels tend to break often so you will want to again refer to your piles of technical analysis to determine the timing of your entry into the trade. Ask any surfer and they will also tell you about the benefits of identifying breaks and how to make them work to your advantage. Not that surfers make good or bad Forex traders, either.
Did We Mention There’s More To It Than That?
You had to know we were going to give you some more information on this, didn’t you? Well, there are a couple of ways you can play the bounce or the break which can either be impressive or not depending on your style, the way you want to be perceived as a trader and the way in which you like your coffee. While none of that has any true bearing on this, the point we are making is that the way you play it is about as personalized as you are an individual Forex trader and not exactly like anyone else.
In other words, you can be aggressive or conservative in your approach based on what signals you are getting from the technical analysis. Remember, you need convincing proof to back up your reasons for doing what you do in trades. You may find that using the bounce or the break will enhance your portfolio or not. Maybe it’s something to use every so often or not at all. The best traders will tell you that they utilize a little bit of everything, stick with a couple of methods then shake it up a little somewhere down the line. This could very well be your method or shall we say, your tactic. Because, after all, you do need to be able to outwit and outplay the market. Having technical analysis as your partner in crime will help you become a better trader.