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resistance
stockmarket.peperonity.net

How Resistance is made use of.

Resistance

What is Resistance Level?

Resistance level is the price from where stocks, slow down, stop moving upwards and they bounce back. Here bears sentiments are stronger which push the price Downtrend.
Resistance is the level where investors believe that price will go down and they start selling the stock results in decrease in price.

Breakout:The markets sentiments keep on changing may results in a breakout due to various reason. It can be fundamental or other market event, etc. While resistance gives a sell signal to the trades, a breakout gives that bulls are stronger compared to the bears results in further increase in price.

Therefore it is important to look at the other technical parameters like Volume, MACD, RSI, Candlestick etc., when trading near Resistance.
Resistance_Sample_trend_tutorials

If the resistance is broken and the price rises above it, it will serve as a support in the future.
What decides the strength of Resistance?
A number of factors a trader may want to look around to see the strength and to confirm it. They are :
1. Length: The longer the duration resistance the more reliable it is. Longer duration shows more points, a price is hitting the resistance line showing the positive sentiments.
2. Height: The broader the distance between the Support and Resistance the more powerful it is.
3. Volume: Higher volumes add strength to the resistance. Higher volumes indicates more traders have the same sentiment at a particular time frame.

Now we have understood what Resistance is. Now its time to understand Support. Please follow these links to find more about Support/Resistance and how it works. We have explained them in details and provided you with ample real life examples of them.


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