Support and resistance are key concepts in technical analysis that refer to price levels where a stock’s price often stops or reverses direction. Support is the level where demand is strong enough to prevent the price from falling further, often causing it to bounce back up. Resistance, on the other hand, is the level where supply outweighs demand, frequently leading to a slowdown in price growth or a reversal downward. These levels help traders better plan their entries and exits by indicating potential points of price reversal or trend continuation.
Why support and resistance?
The answer to this question is important. For swing trading, it is preferable to have the price move closer to support rather than resistance. Support is an area where demand increases and buyers actively enter the market, which can reduce the risk of further price decline and often signals a potential upward movement. This principle helps traders better time their entry into a position with lower risk.
Answers and Score
| ANSWER | SCORE | PRIORITY |
| There is support | 10 | 1,1 |
| There is resistance | 2 | 1,1 |
| Cannot be specified | 5 | 1,1 |
Where to find support and resistance?
You can find a pullback in these charts. For example, on finviz.com or finance.yahoo.com
This question is part of this analyzer.
| Decameron Stock Analyzer – Swing trading, v.1.0 | open analyzer |
