How to draw Resistance Line.

When we draw a line joining all the tops of a price pattern together the line is called a Resistance Line.

It is basically the exact opposite of the support, it is a series of highs on a chart where the market continually rejects the price thus not allowing it to go any higher

Many traders elect to SELL when the price reaches this point

It is our belief that the market likes to test Resistance lines more than once and we look for SELL signals after a second or third testing of this line

The same applies for resistance in that it is a powerful level and one SHOULD think seriously about taking profit at this level.

Some traders like to sell small parcels to average out their price paid and leave the rest in hope of greater gains.