[cowpip]

	Quote:	Sledge
	So is it fair to say that the prices on these instruments will travel between these zones fairly easily without much resistance?

Nothing in forex travels fairly easily without much resistance, imo. There is always resistance. From the micro to the macro time frames, previous support and resistance will be tested. Once in a while, price will take a good jaunt toward the next S/R zone (particularly post-news), but even those zones are usually retested at some point.

	Quote:	Sledge
	... but if I am to use your example if I were keen enough to have gone long @ .7750, would I be fairly confident to let that ride until it gets to the 780 neighborhood (zone) and then re-assess upon its arrival @ 780 to see if: A. It would form a contuniation pattern and stay in the trade or B. See a rejection or reversal pattern and cash out

If you see the price action that supports a quick jaunt back up higher to the 7800 area, then carefully consider it. But contra-trend punts are always riskier. In this case, (and imo) there wasn't a good signal on anything but some sub-hourly bars to attempt a long on. In this particular case, you would have been wiser to be careful because:

1. You're punting contra-trend (always a bad idea).
2. Your target is so small that your entry would have to be quite well defined (on the micro frames - 5 to 15-min frames) and be well executed in order to reduce your risk / reward to a justifiable level.
3. The hourly and (particularly the) 4-hour bars were not encouraging for longs.
4. Pre-weekend position adjustments would have made this an 'iffy' trade.

The price action you saw where it bounced off of the 7750 zone was almost certainly more to do with pre-weekend profit-taking / adjustments. That zone hasn't really been well tested yet and will almost certainly be tested harder next week.

In fact, the current price indicated on the chart (7823) is a former S/R boundary (from the base of the bigger pattern - it's testing the underside of that now) and may actually be a good place to start looking for a reversal signal to run price back down to the 7750 zone.

The safer direction is always with the flow (and in this case, that means short is the path of least resistance). That means being patient and waiting for pull-backs. Then waiting for price action to confirm a reversal back in the direction of the dominant trend.