The Resistance. As the name suggests, resistance is something which stops the price from rising further. The resistance level is a price point on the chart where traders expect maximum supply (in terms of selling) for the stock/index. The resistance level is always above the current market price.
Having learnt about resistance, understanding the support level should be quite simple and intuitive. As the name suggests, the support is something that prevents the price from falling further. The support level is a price point on the chart where the trader expects maximum demand (in terms of buying) coming into the stock/index. Whenever the price falls to the support line, it is likely to bounce back. The support level is always below the current market price
, , Dow Theory, dow theory HB
Hi,
your answers are well framed and appropriate.