Forex Resistance And Big Figures

Forex Resistance And Big Figures

As a pair comes to resistance, it can be seen attempting to breach resistance. This it may do, but it can then come back down though the resistance. Essentially resistance can be seen as establishing a range within which the pair will evidence certain patterns. Resistance typically references a past event, where either support or resistance was found: i.e. these patterns existed.

But looked at this way, it can be seen that the cause of this can be markedly different, as can the cause of any pattern. It can be observed that the constraints on pair movement are what generate patterns, but these constraints can form for many reasons.

This suggests why resistance is not a predictable event. It may occur at past support or resistance (or it may not at all). However it also suggest why big figure analysis has more regularity (and points to the role of big figures in creating regularities). This is because the cause of the pattern is the same, principally the big figure and halfway between. This does not means that directionality can be predicted, but it makes for some kind of regularity in the appearance of this kind of support and resistance.

However it should be noted that patterns consequent on valuation are themselves complex, and can contain multi-directional moves, rather than a horizontal move which rejects one direction. So from many causes may come a predictable pattern. But from one cause may come an unpredictable pattern.

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