Support held 3 times. Should you buy the 4th touch?

Support held three times. Should you buy the fourth touch?

Most traders just buy it, and get stopped out. Don't buy it blindly. Check three things first.

Step one: count the touches right. A touch only counts if price left the level, then came back.

Price grinding along the line is one touch, not five.

Step two: watch the reaction when price hits the line.

A strong reaction looks like this: a long lower wick, or a big green candle that bounces right away. Buyers are still there.

That is when you can buy, with your stop just below the support.

A weak reaction looks like small candles hugging the line, with each bounce shorter. Buyers are getting tired. Don't buy yet.

Step three: watch for a candle that closes below the line.

If that happens, don't buy at all. Old support often turns into resistance.

Wait for price to come back up to the line. If it fails there, that is a possible short, with your stop above the level.

That is exactly what happened on this gold chart. The fourth touch closed below, and the retest from below failed.

Save this checklist. Strong reaction, buy with a stop below. Weak reaction, wait. Close below, don't buy, watch the retest.

Your turn. This oil support held three times. If price comes back a fourth time, would you buy, wait, or sell? Comment below.

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