Free Trading School · Level 9: Key Levels and Multiple Timeframes
Round numbers and psychological levels
Prices like $100, $50, 1.1000 on EUR/USD or $60,000 on Bitcoin attract attention. People place orders, set targets and anchor their expectations at round numbers. As a result, these levels often act as support or resistance, and stops cluster just beyond them.
- Expect reactions at "big figures" (1.0900, 1.1000) and half figures (1.0950) in forex.
- Avoid placing your stop exactly on a round number; put it a little beyond, where the cluster of stops is less likely to be hunted.
- Take profit slightly before a round number, where other sellers are waiting.
Round numbers are where the crowd sits. Plan for a reaction there.
Quick answers
Prices like $100, $50, 1.1000 on EUR/USD or $60,000 on Bitcoin attract attention. People place orders, set targets and anchor their expectations at round numbers. As a result, these levels often act as support or resistance, and stops cluster just beyond them.
Round numbers are where the crowd sits. Plan for a reaction there.
A little beyond it. Stops cluster at round numbers; placing yours a bit beyond reduces the chance of being hunted.
Next lesson: Multiple timeframe analysis