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Strategies & Market Trends : Stochastics -- Ignore unavailable to you. Want to Upgrade?

To: Wayners who wrote (392)	3/27/1998 8:54:00 AM
From: Wayners	Respond to of 927

Support and resistance levels occur all the time. Some are stronger than others. Daily highs and lows create support and resistance levels for the day trader or short term position trader. Intermediate term traders make look for weekly or monthly highs and lows. The longer term trader may use quarterly or yearly highs and lows. A lot of it depends on your timeframe. For me, I look for major support and resistance levels and the daily highs and lows too at position entry and exit. On PAIR, a major support level is at $21 to $21.25. You will notice that several lows in Nov line up almost perfectly with highs in early Jan, early Feb, and early Mar. That is a very strong support level for PAIR. Strong resistance is at $25, $27.50 and $30. The $25 resistance comes from the early high in November. The $21 support level is stronger than the $25 resistance level. Just count up the number of times the price stopped at $21---its a lot of times. Price has only been stopped a few times by the $25 level. Also look at the volume that occurred when the price stopped. That also gives you an idea of how strong that level is. High volume at support/resistance reversal points indicates tells you how strong the market thinks that support/resistance level is. PAIR has a nice uptrend going. Its just barely past the $21 level. I think I'd set a stop at $20 3/8. That gives protection below the $21 level and also below a daily level that's at $20 1/2. <<I have been playing the TA on Pairgain (PAIR). I was wondering ifyou could help me out. I want to put a stop but don't know at what level. I am thinking I want to put a stop to just below the resistance level to ensure that if we have a drop and it doesn't go below the resistance and then jumps back up, I won't get knocked out. If it goes below the resistance level, it could continue with no resistance, so that would be a good time to go out. Is that logical? How do I tell where the current resistance is for me to set the stop. and with the current run, where do I look for the TA to give a sell signal. >>