Analysis

Support & resistance

Price areas where buying or selling has repeatedly halted a move.

Support is an area where buying has repeatedly been strong enough to stop a fall; resistance is where selling has repeatedly stopped a rise. They work because of memory: traders who bought there defend it, traders who missed it wait for a retest, and trapped traders want out at break-even.

Levels are zones rather than exact prices, and the strongest ones were touched more than once, produced sharp reactions, and are visible on a higher timeframe. Broken resistance that price holds above frequently becomes support on the retest.

Taught in these lessons

Support, resistance & levels — Charts & Execution
Placing a stop that makes sense — Risk & Position Sizing
Writing a trading plan — Strategy & The Journal
Building a routine that lasts — Psychology & Longevity