What Are Support & Resistance?
Support
A support level is a price point where buying interest is strong enough to prevent the price from falling further. Think of it as a "floor" that catches falling prices.
- •Buyers enter at this level, creating demand
- •Price tends to bounce up from support
- •Breaking below support is bearish
Resistance
A resistance level is where selling pressure prevents prices from rising higher. Think of it as a "ceiling" that blocks upward movement.
- •Sellers enter at this level, creating supply
- •Price tends to fall from resistance
- •Breaking above resistance is bullish
Interactive Price Simulator
Watch how price bounces between support and resistance levels. Adjust the levels and observe the behavior.
Practice: Draw Your Own Levels
Click the buttons below, then click on the chart to draw your support and resistance lines. See how close you get to the optimal levels!
How to Identify Key Levels
Multiple Touches
The more times price bounces off a level, the stronger it becomes. Look for at least 2-3 touches.
Volume Confirmation
High volume at a price level often indicates strong support or resistance. Volume validates the importance of a level.
Higher Timeframes
Levels on daily and weekly charts are more significant than those on 1-minute charts. Always check multiple timeframes.
Round Numbers
Prices like $100, $50,000, or $1.00 often act as psychological support/resistance due to human trading behavior.
Support Becomes Resistance (and Vice Versa)
One of the most important concepts in technical analysis: when a support level is broken, it often becomes resistance, and vice versa.
Breakout Above Resistance
Old resistance becomes new support. Price may "retest" this level before continuing higher.
Breakdown Below Support
Old support becomes new resistance. Price may "retest" this level before continuing lower.
Trading Strategies
1. Support/Resistance Bounce
Buy at support, sell at resistance
Just below support / above resistance
Opposite level (support to resistance)
2. Breakout Trading
When price breaks and closes beyond level
Below/above the broken level
Next major level or measured move
3. Retest Entry
When price returns to test broken level
If price re-enters the previous range
Extension of the breakout move
Trade at Key Levels
Key Takeaways
Support is the floor where buyers step in; resistance is the ceiling where sellers take over
Levels become stronger with more touches and higher timeframes
When broken, support becomes resistance and resistance becomes support
Always use stop losses when trading around support and resistance levels
Start Trading Key Levels Today
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