How critical do you think it is to look at support and resistance or time frames when you’re trading?
As Tim Bohen loves to say, you gotta “make the case for the trade.” That’s exactly why you have to consider a number of key variables before every trade.
SteadyTrade co-host and newbie trader Kim Ann Curtin is learning these variables. It’s a vital part of her trading education. And Stephen Johnson is helping her learn the ropes. In Episode 136, they covered float and daily volume…
Today, the lessons continue as they discuss time frames and support and resistance.
This review of fundamentals is ideal for new traders, and established traders can get a refresh on trading essentials.
How’s Kim Doing?
You’ve already observed Kim’s ongoing trading education in Episode 132 and Episode 130 … but how’s her trading progressing?
In this episode, she explains the work she’s doing — reading books, watching videos, and immersing herself in the world of Tim Sykes.
Kim and Stephen discuss the sometimes polarizing force that is Tim Sykes. He seems to have the ability to inspire passion … both positive and negative.
Kim talks about how she’s loving Sykes’ authenticity and real talk. She appreciates how he DOESN’T do something that so many other trading gurus do — make unrealistic promises or tell traders they’ll get rich quick.
They talk about the Sykes model of “trading like a coward.” Tune in to learn why that can be a smart way to trade long term.
Time Frames
When traders talk about time frames, they’re talking about different time intervals on a stock’s chart. For instance, you could look at an intraday chart or a two-day chart on a 15-minute time frame or 30-second time frame … The options are endless.
Stephen explains how each time frame can give you different information. It can be a way to learn whether a stock is bullish or bearish.
In the episode, Stephen explains to Kim why time frames matter … and which time frames most traders use. Which is better … longer or shorter?
They talk about how different traders might gravitate toward different time frames. For instance, a day trader might look at a different frame than a swing trader.
Stephen even shares his own proprietary preferences for time frames. Learn why he loves his choice, and how he’s settled on a setup where he has “no compromise” on his plan.
It might sound complicated. But according to Stephen, in time you can “learn how to read the Matrix and then become Neo.”
Support and Resistance
According to Kim’s findings, support is where a stock’s price tends to stop falling. Resistance is where it tends to stop rising.
But why does that matter?
Stephen talks about how it’s largely a game of probability. For example, if a stock fails to break resistance three times, it’ll probably fail again on the fourth time.
Then again, sometimes there’s an exception. Then it’s like a scene out of “Game of Thrones” … The castle gates give way and the army crashes through.
Stephen talks about how stocks can eventually break through support or resistance, but you can’t quite know when or how. Nonetheless, you can still use these points to help determine your own entry and exit points for a trade.
Bringing It All Together
Kim and Stephen talk about bringing all of these variables together. Ultimately, you’re looking at what’s happened before. You’re then trying to apply this information to the stock’s potential future performance.
Here’s the good news … as confusing as it is at first, it gets better with practice and experience. Once it becomes more second nature, you start to know what’s likely. At least … that’s what Stephen says.
Got Questions?
Wanna ask about these variables or ask our hosts to discuss a specific topic? Drop us a line!
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