How to use support/resistance line rebounding strategy in trading


Line rebounding strategy

This is a pattern that tries to catch the moment in which the price is unable to move through the support/resistance, in which the price cannot break out of these levels.

Rebound strategy

It is believed among traders that the uptrend is over the moment the price touches the resistance level and the first candle closes beneath the line. They will open short positions then.

Price reacts with resistance line
Price reacts with the resistance line

The same applies to the opposite situation when there is a downtrend on the market. When the price hits the support and the first candle closes above it, it is a signal to go long.

Price reacts with support line
Price reacts with a support line

Key TakeawaysπŸ”‘

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Rebound line strategy in other cases

The line rebounding strategy validity does not end with horizontal lines like support and resistance. Just take a look at the picture below and you will notice, it also works with the diagonal lines which you can draw along the trend.

Price reacts not only with horizontal lines
Price reacts not only with horizontal lines

If you need further information about support/resistance, I encourage you to read the articles about combining trendline with support/resistance and about trading RSI with support/resistance.

Good luck!

Pros and Cons πŸ˜ŠπŸ˜”

Let’s explore the advantages and disadvantages of the line rebounding strategy:


  • βœ… Simple strategy that can be easily understood and applied.
  • βœ… Provides clear entry and exit signals based on support/resistance levels.
  • βœ… Works well in trending markets, both in uptrends and downtrends.
  • βœ… Can be combined with other technical analysis tools for confirmation.


  • ❌ False breakouts can occur, leading to potential losses.
  • ❌ Requires accurate identification of support/resistance levels.
  • ❌ Not suitable for all market conditions, such as range-bound markets.
  • ❌ Relies on historical price data and may not guarantee future performance.


  • Q: What is the line rebounding strategy?
  • The line rebounding strategy aims to identify moments when the price fails to break through support or resistance levels. Traders use this pattern to anticipate reversals and open positions accordingly.

  • Q: Does the line rebounding strategy work with diagonal trendlines?
  • Yes, the line rebounding strategy can be applied to diagonal trendlines as well. It recognizes the significance of price reactions at various angles of trendlines.

  • Q: Are there any recommended resources to learn more about combining trendlines with support/resistance?
  • For further information on combining trendlines with support/resistance, I recommend reading articles that explore this topic in detail.

  • Q: Can the line rebounding strategy be used in conjunction with other technical analysis tools?
  • Absolutely! Traders often combine the line rebounding strategy with additional indicators or oscillators to validate trade signals and enhance their trading decisions.

  • Q: Is the line rebounding strategy suitable for all market conditions?
  • The line rebounding strategy works best in trending markets, where clear support and resistance levels can be identified. It may not be as effective in range-bound or choppy markets.

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Bart Bregman

Full time day trading, and helping out with Olymp Trade wiki in my spare time to create an awesome platform for beginners. I'm a digital nomad that travels the world while working from everywhere!

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