Support
Support is a price area where buying pressure may become strong enough to slow or stop a downward movement.
Resistance
Resistance is a price area where selling pressure may become strong enough to slow or stop an upward movement.
How traders use these levels
Support and resistance may help traders:
- Find possible entry areas.
- Place stop-loss orders.
- Set possible profit targets.
- Identify breakouts.
- Recognize false breakouts.