Aspen Trading S/R Levels v2

2022년 6월 22일

In Trading, Objectivity Trumps Subjectivity

“Every trader is a steaming hot bowl of bias stew and must maintain self-awareness and lucidity behind the screens as the trading day oscillates between boredom and terror.”

The above quote is from a good friend of mine and veteran FX trader Brent Donnelly. It completely nails the biggest challenge for new and even experienced traders: being as objective as possible when making trading decisions.

Yes, as you become more experienced, subjectivity, market feel and experience are part of one’s decision-making matrix, but early on you do not have that luxury.

If you start each day knowing that price action in the market is random it will remind you to think objectively. There are, however, repeatable patterns that occur again and again…..it’s your job to identify them.

That’s where Support & Resistance levels come in.

Definitions: “Support” and “Resistance” Levels

Many technical indicators and tools can be subjective and challenging to learn. This is not the case with support and resistance levels.

Support and resistance are terms for two price levels on a chart that appear to limit the security’s range of movement.

The “support level” is where the price regularly stops falling and bounces up.
The “resistance level” is where the price normally stops rising and dips back down.

The more frequently a price hits either level, the more reliable that level is likely to be in predicting future price movements.

Understanding Support and Resistance Levels

Remember, the more informed and objective we can be with numbers, the more confident we can be with our trades. That’s important because, although price action is random (a fact that has been proven time and time again), there are repeatable patterns we can use to get an edge.

Two of those objective data points we can use to gain an edge are support and resistance levels. These are two of the best tools we have when it comes to swing trading. Why? Because they give us strong data points that suggest where an instrument is likely (and unlikely) to go.

But this is really key: Arbitrarily cataloging each price level that appears to be relevant as a support or resistance level isn’t going to get you far. That’s why Aspen Trading takes a unique approach to support and resistance levels.

With Aspen’s Support & Resistance Levels, we measure where trades (prices) occur in terms of frequency. This gives us a sense of where market participants are wagering prices may go.

That’s about as raw and unfiltered as you can get in terms of displaying what has taken place. There’s no room for interpretation - this is raw data that can be used to get a sense of where prices may be heading.

Learning The “Four Sets” of Support and Resistance Levels

There are four sets of support and resistance levels that are part of Aspen Trading’s S/R framework.

Each set of support and resistance levels is unique to a specified period of time. We display each of them in different colors on our charts when we analyze trades to make it easy for us to understand the data as we get comfortable reading charts.

You’ll see each of these levels on display in the charts that follow below. The four sets of support and resistance levels are classified as follows:

There are four sets of support and resistance levels that are displayed by Aspen Trading’s S/R Analysis Tool. Each one is unique to a specified period of time that we then display directly on the chart. The levels are classified as follows

GREEN: displays 2 dotted lines (upper/lower)
ORANGE: displays 2 dotted lines (upper/lower)
RED: displays 2 dotted lines (upper/lower)
PURPLE: displays 2 dotted lines (upper/lower)

IMPORTANT:

What’s the distinction between the 4 color levels?

Essentially think of these levels on a rising scale of importance. While GREEN levels are certainly key, they do not hold the same level of significance as the PURPLE levels.

To get access to Aspen's S/R Levels - simply purchase an annual license for $595 at the link below. Once the transaction is complete, we will email you asking you for your TradingView username and get you permisisoned within 12-hours.

2022년 6월 24일

릴리즈 노트

In Trading, Objectivity Trumps Subjectivity

“Every trader is a steaming hot bowl of bias stew and must maintain self-awareness and lucidity behind the screens as the trading day oscillates between boredom and terror.”

The above quote is from a good friend of mine and veteran FX trader Brent Donnelly. It completely nails the biggest challenge for new and even experienced traders: being as objective as possible when making trading decisions.

Yes, as you become more experienced, subjectivity, market feel and experience are part of one’s decision-making matrix, but early on you do not have that luxury.

If you start each day knowing that price action in the market is random it will remind you to think objectively. There are, however, repeatable patterns that occur again and again…..it’s your job to identify them.

That’s where Support & Resistance levels come in.

Definitions: “Support” and “Resistance” Levels

Many technical indicators and tools can be subjective and challenging to learn. This is not the case with support and resistance levels.

Support and resistance are terms for two price levels on a chart that appear to limit the security’s range of movement.

The “support level” is where the price regularly stops falling and bounces up.
The “resistance level” is where the price normally stops rising and dips back down.

The more frequently a price hits either level, the more reliable that level is likely to be in predicting future price movements.

Understanding Support and Resistance Levels

Remember, the more informed and objective we can be with numbers, the more confident we can be with our trades. That’s important because, although price action is random (a fact that has been proven time and time again), there are repeatable patterns we can use to get an edge.

Two of those objective data points we can use to gain an edge are support and resistance levels. These are two of the best tools we have when it comes to swing trading. Why? Because they give us strong data points that suggest where an instrument is likely (and unlikely) to go.

But this is really key: Arbitrarily cataloging each price level that appears to be relevant as a support or resistance level isn’t going to get you far. That’s why Aspen Trading takes a unique approach to support and resistance levels.

With Aspen’s Support & Resistance Levels, we measure where trades (prices) occur in terms of frequency. This gives us a sense of where market participants are wagering prices may go.

That’s about as raw and unfiltered as you can get in terms of displaying what has taken place. There’s no room for interpretation - this is raw data that can be used to get a sense of where prices may be heading.

Learning The “Four Sets” of Support and Resistance Levels

There are four sets of support and resistance levels that are part of Aspen Trading’s S/R framework.

Each set of support and resistance levels is unique to a specified period of time. We display each of them in different colors on our charts when we analyze trades to make it easy for us to understand the data as we get comfortable reading charts.

You’ll see each of these levels on display in the charts that follow below. The four sets of support and resistance levels are classified as follows:

There are four sets of support and resistance levels that are displayed by Aspen Trading’s S/R Analysis Tool. Each one is unique to a specified period of time that we then display directly on the chart. The levels are classified as follows

GREEN: displays 2 dotted lines (upper/lower)
ORANGE: displays 2 dotted lines (upper/lower)
RED: displays 2 dotted lines (upper/lower)
PURPLE: displays 2 dotted lines (upper/lower)

IMPORTANT:

What’s the distinction between the 4 color levels?

Essentially think of these levels on a rising scale of importance. While GREEN levels are certainly key, they do not hold the same level of significance as the PURPLE levels.

To get access to Aspen's S/R Levels - simply purchase an annual license for $595 at the link below. Once the transaction is complete, we will email you asking you for your TradingView username and get you permisisoned within 12-hours.