What is Support and Resistance

What is Support and resistance?

Support:

Previous significant Low of the Price acts as Support.

Support(Floor) levels prevent the market from moving prices downward.

Price tends to bounce from Support. More times Price respects Support Area, the stronger the Support.

However, once Price brakes the Support, it is likely to continue until it finds another Support level.

Resistance:

Previous significant High of the Price acts as Resistance.

Resistance(Ceiling) levels prevent the market from moving Price upward.

Price tends to bounce from Resistance.  More times Price respects Resistance Area, the stronger the Resistance.

However, once Price brakes the Resistance, it is likely to continue until it finds another Resistance level.

Support & Resistance Lines

Important:

Remember, Support is not always Support.  It is tend to break.  Once Support level breaks, it acts as near Resistance.

Same way, Resistance is not always Resistance.  It is tend to brake.  Once Resistance level breaks, it acts as near Support.

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