The cause is not as significant as the effect, new expectations lead to new price levels.
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When price action drops to a certain level the bulls.
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If I enter a trade on the short side after a signal, as in the example below I will place my stop in the next nearest resistance.
the truth about trading currency
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That is why technical analysis is not an exact science.
That is the price at which traders are prepared to buy from you.
Dow interpretation of a trend was that each rally high be higher than the previous rally high and each rally low be higher than the previous rally low.