Trading in the stock market works well when the market does not move in a single direction, there should be a range between that it should keep moving for days till any positive or negative factor influences the big move. The market keeps bouncing back from these lower levels and turns back after reaching the upper levels creating support and resistance zones.

These levels are known as support and resistance which are very crucial points providing the trading opportunity for the traders. However finding the right support and resistance levels is not an easy task, because there could be multiple such points that look like support and resistance but do not always work. Hence you need to find strong support and resistance.

What is Support and Resistance in Stock Market Trading?

Support and resistance are two crucial points at the lower and higher side respectively where stock price movement or market index stops moving further. At support levels, stock price or market bunch backs and at resistance levels stop going upside and turn back.

To break these levels, the market or stock price needs a strong push with a huge volume of trade to breakout & breakdown from this trajectory. Traders use these support and resistance levels as a trading opportunity and usually, buy the underlying security at support levels, and book the profit at the resistance levels, or enter into a short-selling trade position.

Also Read: How to Add, Read & Use Best Volume Indicator in TradingView

How to Find Support and Resistance?

To find or identify the support and resistance you can use various tools and techniques like checking the historical price, price movement on a chart and technical indicators that can easily show you different levels of support and resistance as per the stock price movement and its historical price data where it has taken the support and resisted.

Historical Price Data: Checking the historical price data, will help you to know at which price levels it has taken support and bounced back and from which resistance price levels it has come down. Using the historical data you can use the formula and calculate the support and resistance points.

It can show you multiple supports and resistances, but choose the right one that is suitable for trading so that you can easily decide the buy and sell levels.

Support and Resistance in Chart: Apart from historical price data, you can also visualize the support and resistance points on charts where the stock price or market index is turning back. Use the candlestick chart patterns and you can see where the low points or closing points are almost the same it works like a support level.

Also Read: How to Read, Analyse& Use Candlestick Chart Patterns for Trading

Similarly, in the chart, you can easily see the upper range from where the market or stock price is turning back and coming down. This level is called the resistance level which could be the opening price or highs of the underlying asset. To see the same in the charts you can draw two parallel lines at the upper and lower sides and the touching points are support and resistance levels.

Technical Indicators: Apart from historical price and chart-based support and resistance levels, you can use the technical indicators that can give more precise levels. You just need to apply or draw the indicator and it will automatically calculate and show you the best support and resistance levels, as per your selected range.

Also Read: Top 5 Best Technical Indicators for Intraday or Day Trading

The best way to find the best support resistance indicators is to use the TradingView chart system where you will get unlimited functions to customize your chart as per your trading strategy. However, to find the support and resistance levels in TradingView you must have access and knowledge or experience of using the TradingView.

Also Read: How to Understand Chart Structure in TradingView: Explained

How to Find Support and Resistance Levels in TradingView?

In TradingView to find the resistance and support levels, use the technical indicators that can be easily drawn or applied to different types of underlying securities like equity, commodities, currency and future or options trading securities.

Though we have discussed about the charts or price data that you can use for the support and resistance let us discuss about the technical indicators that you can use to find the support and resistance in TradingView.

Also Read: How to Add or Remove, Hide & Save Indicators in TradingView

5 Best Support Resistance Indicator TradingView

1.Fibonacci Support & Resistance Indicator

Fibonacci retracement is one of the best technical indicators you can use in the TradingView. When you draw the Fibonaccion candlestick charts you can see there are multiple support and resistance levels showing with values of 23.6%, 38.2%, 50%, 61.8% and 78.6%.

Also Read: How to Use Fibonacci Retracement for Trading: Setting & Strategy

To draw the Fibonacci retracement choose the lowest point from where the market started a rally and place at the highest point where the rally ended and the market turned down. When you place the two points then you can see the support and resistance levels at different points showing as per the movement of the market from the starting point to the ending point.

You can draw the Fibonacci retracement in both uptrend and downtrend market rallies. You just need to place the two points at the right place to see the right support and resistance levels. In the TradingView chart on the left-hand side tools, you can see the Fibonacci retracement tool with multiple other options to customize the same.

Also Read: How to Use Supertrend Indicator in TradingView: Settings & Strategy

2. Moving Averages Indicator for Support & Resistance

Moving averages is another one of the most popular technical indicators that you can use for support and resistance. There are various types of moving averages simple moving averages, exponential, weighted, volume-weighted and smoothed.

Also Read: How to Use Moving Averages in Trading & Convergence Divergence

You can use short to medium or long-term moving averages like 20-day, 50-day and 200-day plotted on the price line or chart. In TradingView you can choose to plot the moving average and customize the days as per your trading strategy.

Also Read: How To Use Best Moving Averages for Intraday or Day Trading

When the moving average line moves below the price, it indicates an uptrend and acts like support, and when the moving average trades above the price, it shows a downtrend and this also works as the resistance levels. However, these support and resistance are also called dynamic levels, as these support and resistance keep changing.

3. Bollinger Bands for Support & Resistance

Bollinger Bands is another useful technical indicator in the TradigngView chart that you can also use to identify the support and resistance. This is the combination of moving averages and channels containing the three bands showing the volatility in the market.

Also Read: Bollinger Bands: Indicator, Strategy, Settings& Analysis

The middle line works as a moving average and considered as the great support and resistance. Though, the movement of the stock price or market index, between these bands or lines shows the trend, but also acts as the support and resistance levels.

When the stock price or market index trades between the lower band and middle line, it is a downtrend and acts as a resistance level. Conversely, when the same trades between the upper band and middle line, it is in an uptrend, the middle line works as the support level. Based on this support and resistance you can enter into a trade position.

4. Keltner Channels for Support & Resistance

Keltner Channels is an indicator that keeps fluctuating with the price change but also shows the support and resistance levels. In TradignView you can find and draw the Keltner Channels from the indicator section, three lines Bollinger bands will be plotted.

When you analyse the Keltner Channels from the support and resistance perspective, the middle line and channel bottom work as the support levels. When the channels are moving up and the price is in an uptrend, you can use the middle line and channel bottom as the support levels.

Also Read: How to Add & Use RSI Indicator in TradingView: RSI Settings & Strategy

While on the other hand, when the price moves down and the channel also goes down you can use the middle line and the channel top as the resistance levels. However, when the Keltner Channels indicator moves sideways it shows the market moves sideways and you can use the channel as the resistance and the bottom of the channel as the support levels.

5. Pivot Points for Support & Resistance

Pivot Points are another best tool or you can say an indicator that you can use for support and resistance. However, rather than using the trend line or any tool, the pivot points are calculated on the basis of close price, high price, and low price of the last trading day.

After calculating the pivot points you can plot these points on the chart patterns that will show the support and resistance at one glance. You can use this indicator to identify the trend reversal signal that will help to enter into the right trading position.

Also Read: What are the Best and most Accurate Trend Reversal Indicators

In TradingView you can apply the Pivot Points Standard and Pivot Points High Low two main types of technical indicators that automatically calculate, plot and show the pivot points as per the previous open, low,high and closing price of the stock or market.

Best Support and Resistance Trading Strategy

Using the support and resistance indicators in the trading strategy helps the traders maximize their returns and minimize the risk. You can use thesupport and resistance levels and indicators in trading strategy as entry and exit points for trading.

Also Read: How to Trade in High Volatile Market: Best Trading Strategies

As a Buying & Selling Point: As a trading strategy, when the price of the stock or market index is trading at the support levels, you can enter into a long position (Buy). And when the price of the underlying asset or market index is trading at the resistance levels either you can exit from the long position by booking the profits or go for short-selling.

Book Profits & Stop Loss: Apart from choosing a buying and selling point you can use the support and resistance levels to put the stop loss while entering into the trade positions. For long trade positions place the stop loss below the support point and in short-selling you can put the stop-loss above the resistance levels because these points are strong points.

Also Read: Stop Loss in Stock Market: How to Set Stop Loss Strategy & Take Profit

You can also use the support and resistance as your target points for profit booking or exiting from the trade positions to avoid any losses. However, to confirm the support and resistance levels as the buying and selling points, you can also use the technical indicators.

Breakout & Breakdown: Support and resistance levels work as strong points and it is not easy to break unless there is huge volume or trade or strong news in the market. When a stock price or market index breaks the resistance levels, it means the bullish trend started and it can move further creating the opportunity for the traders to buy or book profits.

Also Read: Bullish Trend Reversal Candlestick Patterns

On the lower side, when the stock price or market index trades around the lower levels and breaks down the support levels it means the bearish trend started. Here traders enter into new short-selling positions or book the profits in existing trade positions. Breaking the support and resistance means the stock is coming out from its sideway trading trajectory and will continue for a few days, until creating the new support resistance levels for trading.

Final Words

Support and resistance are the two crucial points that provide wonderful trading opportunities for traders. Apart from drawing a trend line, you can also use the historical price data to find the support and resistance levels. The best way to identify or draw the support and resistance on charts is to use the technical indicators in TradingView.

Also Read: What are the Top Best & Most Used Indicators in TradingView

From Bollinger Bands to Fibonacci Retracement to Moving Averages and Pivot Points you can use multiple other technical indicators as the support and resistance. In TradingView you can easily find and draw the indicators with the option to customize the chart, time period and other parameters as per your ease of use or applicability and trading strategy.

Also Read: How to Set Up, Adjust, Save, Clear, Reset TradingViewChart  Settings

However, in the trading strategy, you can use the support levels for creating a long position, while resistance levels work like short-selling points. Moreover, the support and resistance points are also used for putting the stop losses or setting the target for profit booking.

If you want to minimize your losses and maximize your chances of profits, then you need to trade with the right trading strategy. For that, you need to open a demat and trading account with a discount broker or full-service broker providing the trading and investing facility through the online trading platform with intraday trading tips and recommendations.

Also Read: What is the Best Indicator for Intraday Trading in TradingView

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Also Read: Choosing the right broker: Decoding the mystery of lowest brokerage charges