✅ Lesson 3.1 – S/R Basics: Long and Short Trades

Learn how to use support and resistance to time long and short positions effectively.

🎯 Lesson Objective

This lesson introduces the foundational concept of taking long and short trades in Forex, and explains how support and resistance (S/R) levels guide your entry and exit decisions for each type of position.

🧱 The Role of Technical Analysis (TA)

The main goal of technical analysis is to identify:

• Low-risk entry points (typically near support)

• High-reward exit points (typically near resistance)

This principle applies whether you are buying (going long) or selling (going short).

📘 Key Definitions

📈 Going Long (Buy First, Sell Later)

• You expect the currency pair to go up in value

• You open your position by buying at support (low price)

• You close the position by selling at resistance (high price)

• Similar to: buying wholesale and selling retail

📉 Going Short (Sell First, Buy Later)

• You expect the currency pair to fall in value

• You open your position by selling at resistance (high price)

• You close the position by buying back at support (low price)

• Similar to: selling now and buying it back cheaper later to make a profit

🔄 Support and Resistance (S/R) in Long vs Short Trades

📌 In both cases, you enter near support and exit near resistance.

💡 Why This Matters

Support and resistance zones act like boundaries in the market.

• Entering trades near support reduces your downside risk.

• Exiting near resistance locks in profits before reversals occur.

🧠 Mental Shortcut

Think of it like this:

• Support is where the market is likely to bounce up

• Resistance is where the market is likely to fall back

Your trade strategy:

• Buy low (support), sell high (resistance) → Go Long

• Sell high (resistance), buy low (support) → Go Short

📘 Lesson Summary

• Long = Buy → Sell higher

• Short = Sell → Buy back lower

• Support is your entry zone; resistance is your profit zone

• Strong S/R zones provide low-risk entries and high-reward exits

✅ Instructor’s Tip

“Don’t overcomplicate it. You want to enter trades near support and exit near resistance, whether you’re going long or short. That’s the essence of profitable technical trading.”

📘 Next, we’ll begin applying these concepts in real trade setups using S/R zones and candlestick confirmation.