Marking Important Areas: Where Price Pays Attention
Risk warning: Areas can break on any chart. This is education, not financial advice or a trading signal.
An important area is a small zone where price reacted clearly two or more times. You mark one support below price and one resistance above price, then you wait.
In Part 1 this was point three of the five-point process. In Part 2 you found direction with swing highs and lows. This lesson turns those swings into zones you can plan around.
Demo example — not a signal.
Why location beats pattern
A candle pattern means little in empty space. The same candle at a marked area means more.
Think of a worn doorway in a Lagos compound. Paint fades where many hands pushed. One touch means little. Many touches mark a real path.
Price works the same way. A zone with two strong bounces shows where buyers or sellers acted before. It can still break. But an unmarked middle gives you no plan at all.
Read Support and Resistance: The Floors and Ceilings of Price.
What counts as important
Not every bounce deserves a zone. Demand three traits before you draw.
- Two clear reactions. Price turned or paused twice at nearly the same place. One touch is a guess.
- Visible moves. Each reaction has a clear bounce or long wick. Tiny pauses inside noise do not count.
- Recent and near. The area sits close to current price and formed in recent days. A level from three months ago matters less on H1.
If an area needs defending, it is not clear. Skip it and wait for one that stands out.
Use zones, not lines
A zone is a small band that covers past turning points. A line is a single exact price. Beginners should use zones.
Price rarely turns at the same pip twice. Spread, the small gap between buy and sell prices, plus normal wicks push price a few pips past your mark.
Draw a thin band across the bodies and wicks of the two reactions. On EUR/USD H1, that band is often 10 to 20 pips wide. Anything wider is a range, not an area.
A stop placed exactly on a line dies from normal noise. A stop placed beyond a zone survives small wobbles. You will plan that stop in a later lesson.
Mark areas in four steps
Open EUR/USD on H1. Use the London and New York overlap, around 1pm–5pm WAT, when moves look cleaner.
- Zoom out — show 50 to 100 H1 candles. Small wiggles fade and real turns stand out.
- Find two reactions — look for two bounces near the same price below or above current price.
- Draw one band — cover both wicks with a small zone. Label it support or resistance.
- Keep two zones — one support below, one resistance above. Delete the rest.
If price sits in the middle between your two zones, you have no trade. The middle is where beginners donate money. Wait for price to reach a zone.
Keep chart clean
Compare two charts. Chart A has ten lines, three colours, and no space. Every candle touches something.
Chart B has two gold bands and white space. You see direction, you see distance, you decide fast.
Ten lines create ten reasons to click. One Telegram signal plus ten lines means you will always find an excuse. Two zones force patience.
Keep the same rule every day. If both zones sit too close together, room is small. Skip the chart even when direction looks clean.
When to redraw
Areas age. Price behaviour tells you when to erase.
- Clean break and keep going. A full H1 candle closes beyond the zone and the next candle continues. Delete the old zone.
- Fresh reaction nearby. Price turns twice at a new nearby price. Draw the new band and drop the old one.
- Price ignores it thrice. Three passes with no pause mean buyers and sellers moved on. Remove it.
Never drag an old zone toward current price to force a trade. That is hope, not analysis. Read Trends: Trading With the River, Not Against It.
Common mistakes
Drawing ten lines
Each extra line adds a false entry. Beginners mark every small pause, then feel surrounded by signals. Mark only zones with two strong reactions.
Trusting old levels
A famous level from months ago feels safe. Markets forget. If recent candles slice through it without pausing, the area is dead.
Demanding exact touches
Waiting for price to touch your line to the pip wastes weeks. Price turns inside zones, not on razor edges. Plan around the band, not the line.
Marking on M15 only
M15 bounces appear and vanish in hours. Anchor every zone to H1 swings first. Use M15 only for finer timing when price reaches your H1 zone.
Your practice task
Use replay mode or a demo chart. Do not fund an account for this exercise.
- Open EUR/USD — use H1 and zoom out.
- Mark one support — find two clear bounces below price.
- Mark one resistance — find two clear rejections above price.
- Draw zones — cover the wicks, not single pips.
- Measure room — note the distance between zones.
- Screenshot — save the chart before the next candle closes.
- Log 20 charts — include charts where you found nothing to mark.
On demo with $10, room matters. A tiny gap between zones means even a win pays little after spread. Waiting protects the small account.
Read How to Use a Demo Account Before Risking Real Money and The Trading Journal.
Next in series
Direction tells you which side to favour. Areas tell you where to wait. The next lesson asks the hard question: is price pulling back, or is the trend ending?
For candle timing at these zones, read Candlesticks: What Each Candle Tells You.
Continue with Part 4 — Pullback or Reversal. It builds directly on the zones you marked today.
Bottom line: Mark one support zone and one resistance zone with two clear reactions each, then wait for price to reach them. Zones break often, so keep risk near 1% and skip cluttered charts.
Part 3 of the KoboFX Price Action Series. Previous: Part 2 — Finding Market Direction. Cross-links: Support and Resistance, Trends, The 1% Rule.
Frequently Asked Questions
Where should I mark support and resistance on a forex chart?
Mark areas where price reacted clearly two or more times. Use one support zone below price and one resistance zone above price. Ignore tiny touches and old levels that price now passes through easily.
Should I use a line or a zone for support and resistance?
Use a zone, a small band that covers the wicks of past reactions. Price rarely turns at the exact same pip. A thin line breaks too often and pushes beginners into early entries.
How many levels should a beginner draw?
Two at most: one support and one resistance near current price. Ten lines create ten reasons to click. A clean chart with two zones keeps your decision simple.
When should I redraw or delete an area?
Delete it when price closes through the zone and keeps going. Redraw it when a fresh reaction forms nearby. An area that price ignores three times is no longer important.