I’ll commonly refer to price in trending environments as stacking bricks, because you will notice over and over again that price forms “blocks” and stacks diagonally, one on top of the other. Below we have a chart of USD/CAD. You’ll see that on 3 different occasions during this uptrend, a level of resistance turned into a level of support, a bullish sign indicating further price movement upwards.
In regards to intraday trading, using this technique and using these levels will provide high probability setups over and over again on heavily trending days. When an area finally becomes broken, it is typically a sign that the uptrend is over and either reversal or consolidation is on the way.
Additionally, you will notice from the chart that the diagonal trendline was forfeited for the horizontal support and resistance. Playing a bounce off of a diagonal trendline would not have given you nearly as good of an entry as the horizontal lines, or you would have missed entry altogether, depending on how you were to draw the line. It is why we always require horizontal support and resistance be present before entering any trades.
