Overview
This lecture covers how to identify and trade Support and Resistance (SNR) breakouts using various timeframes, focusing on price reactions, momentum, and entry points.
Identifying Key Levels
- Always start by marking daily, weekly, and monthly support and resistance zones on higher timeframes.
- Only look for breakouts after clearly marking these levels to avoid confusion.
- Use H4 (4-hour) and H1 (1-hour) timeframes for more solid breakout confirmations.
Understanding Breakouts and Momentum
- A breakout happens when price moves strongly through a support or resistance level.
- Ignore candle patterns; focus on whether a breakout occurs, not how the candle looks.
- Strong momentum: price breaks level with little-to-no sideways movement.
- Weak momentum: price approaches level with sideways or slow movement.
- Wait for a pullback after a breakout; the best entries occur when price returns to the zone with weak momentum.
Entry Strategy and Precision
- For higher accuracy, move from H4/H1 to smaller timeframes (M30, M15) after a breakout is confirmed.
- Precision means narrowing down entries to smaller timeframes for more accurate trades.
- Enter trades when the price pulls back to the marked zone with weak momentum after a breakout.
- If you miss the initial entry, you can enter on the next valid pullback with weak momentum.
Examples & Application
- Identify breakout zones, wait for pullback with weak momentum, then enter at the marked support or resistance level.
- Practice marking levels, confirming breakouts, and monitoring momentum in live or demo charts.
Key Terms & Definitions
- SNR (Support and Resistance) — Key price levels where price often reverses or consolidates.
- Breakout — A decisive move through a support or resistance level.
- Momentum — The strength and speed with which price moves (strong = fast, weak = slow/sideways).
- Pullback — Price temporarily reverses back to a broken level before continuing the trend.
- Precision — Moving to a smaller timeframe to enter more accurately after identifying a breakout on higher timeframes.
Action Items / Next Steps
- Mark daily and weekly SNR zones on your charts before searching for breakouts.
- Monitor H4 and H1 for breakouts, then check for pullbacks with weak momentum on lower timeframes.
- Complete the assigned homework: monitor two marked zones and write reasons for potential entries.
- Review Nathan's follow-up video when it is shared.