What is Support and Resistance Levels?
Support is a price level where buying pressure tends to prevent further decline. Resistance is where selling pressure prevents further advance.
Formula
Identified from historical price action, moving averages, Fibonacci levels, or round numbers.
How to Interpret
Stocks often bounce off support and reverse at resistance. A breakout above resistance or breakdown below support signals a potential new trend.
Typical Ranges
Multiple timeframe confirmation (daily + weekly) strengthens levels.