What is trading?
Trading means trying to make a profit from price differences.
You buy low and sell high, or vice versa (going short).
You can trade in:
- Forex (EUR/USD)
- Gold (XAUUSD)
- Crypto (BTC)
- Indices (US100, S&P500)
Long vs Short
Long (Buy) You expect the price to rise. You buy → sell higher.
Short (Sell) You expect the price to drop. You sell → buy back at a lower price.
Support & Resistance
Support = floor Price stops falling and goes up
Resistance = ceiling. Price stops rising and goes down.
These are the most important levels where you take trades.
What really happens at Support & Resistance?
The market moves through buyers and sellers.
With support, there are more buyers → price goes up
At resistance, there are more sellers → the price goes down
So it is not a “line”, but a zone where orders are located.
Candlesticks
Candles show what the market is doing.
Green candle = price rises Red candle = price falls
NB:
- Long wick = rejection
- Small body = doubt (doji)
Understanding the trend
There are 3 types of market movements:
Uptrend (bullish)
Higher highs and higher lows
Downtrend (bearish)
Lower highs and lower lows
Range (sideways)
Price moves between support and resistance
Always trade with the trend (important!)
In trading, you look at how the price moves.
You do that with:
- Highs (highest points)
- Lows (lowest points)
Higher High (HH)
Higher High = a higher peak than the previous one
The price goes up and reaches a new, higher peak.
What does this mean? The market is strong → bullish (rising)
Higher Low (HL)
Higher Low = a higher bottom
The price is dropping, but not as low as before.
What does this mean? Buyers remain stronger → trend upwards
Together = Uptrend
If you see:
- Higher Highs
- Higher Lows
Then you are in an uptrend
Best strategy: buy (long)
Lower Low (LL)
Lower Low = a lower bottom than the previous one
The price drops further.
What does this mean? The market is weak → bearish (falling)
Lower High (LH)
Lower High = a lower peak
The price is trying to go up, but is not reaching the same level as before.
What does this mean? Salespeople are stronger.
Together = Downtrend
If you see:
- Lower Lows
- Lower Highs
Then you are in a downtrend
Best strategy: sell (short)
Easy to remember
HH HL = up (buy)
- LL LH = down (sell)
Why is this important?
This is the basis of EVERYTHING in trading.
Without this:
you don't know what the trend is
take bad trades
With this: you trade with the market and have better entries.
Combine this with:
Support & Resistance
Trendlines
