Simple Forex Tools

8/8 and 0/8 Lines (Maximum Resistance / Maximum Support) These are the strongest lines, providing the most powerful resistance and support. 7/8 Line (Weak, Stop, and Reversal) This line is weak. If the price moves too strongly and quickly and stops near this line, it will likely quickly reverse downwards. If the price does not stop near this line, it will continue to move up to 8/8. 1/8 Line (Weak, Stop, and Reversal) This line is weak. If the price moves too strongly and quickly and stops near this line, it will likely quickly reverse upwards. If the price does not stop near this line, it will continue to move down to 0/8. 6/8 and 2/8 Lines (Turn, Reversal) These two lines are second only to the 4/8 line in their ability to completely reverse the price move. 5/8 Line (Top of the Trading Range) Prices in all markets spend about 40% of the time moving between the 5/8 and 3/8 lines. If the price approaches the 5/8 line and stays there for 10-12 days, the market is telling you that you should sell in this "premium zone" (and some do). However, if the price continues to stay above the 5/8 line, it will likely remain above it. But if the price falls below the 5/8 line, it will likely continue to fall to the next significant resistance level. 3/8 Line (Bottom of the Trading Range) If prices are below this line and moving up, it will be very difficult for the price to break through it. If the price breaks this line and stays above it for 10-12 days, then prices will likely remain above this line and spend about 40% of the time moving between this line and the 5/8 line. 4/8 Line (Major Support/Resistance Level) This line provides the greatest support/resistance. This level is the best place to open a new buy or sell position. If the price is above 4/8, this is a strong support level. If the price is below 4/8, this becomes an excellent resistance level.