Basic Concepts of Technical Analysis – Support and Resistance

🧭 Support and Resistance Levels

📌 What are Support and Resistance?

Support is where demand exceeds supply, stopping a fall and often reversing price upward. Resistance is where supply exceeds demand, preventing further rises.

✏️ How to Draw Them?

🔽 Support

  • Line connecting previous lows.
  • Can be horizontal or positively sloped.

🔼 Resistance

  • Line connecting previous highs.
  • Can be horizontal or negatively sloped.

💡 Practical Tip

Correctly identifying these levels helps plan entries/exits, set precise stops, and improve trade effectiveness.

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