Sunday, 15 July 2018

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Stock Trade Analysis: Support and Resistance

Support and Resistance is a concept in technical analysis that the movement of the price of a security will tend to stop and reverse at certain predetermined price levels. It’s very useful to while stock trading and considered absolute basic.
Support:

A support level is a price level where the price tends to find supports as it is going down. This means the price is more likely to bounce off this level rather than break through it. However, once the price has passed this level, by an amount exceeding some point, it is likely to continue dropping unit it finds another support level and that is an important stock trading information.
Resistance:

A Resistance level is the opposite of a support level. It is where the price tends to find resistance as it is going up. This means the price is more likely to bounce off this level rather than break through it. However it, once the price has passed this level, by an amount exceeding some point, it is likely that it will continue rising until it finds another.

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