GlossaryBeginner

Support and Resistance

Price levels where an asset has historically tended to stop falling (support) or stop rising (resistance), used in technical analysis to anticipate where price reactions might occur.

Support is a price level where an asset has historically tended to stop falling and reverse upward, reflecting a level where buying interest has repeatedly outweighed selling pressure. Resistance is the opposite: a price level where an asset has historically tended to stop rising and reverse downward, reflecting a level where selling pressure has repeatedly outweighed buying interest. Both are identified by looking at where price has previously reversed on a chart, often around prior highs, lows, or areas of heavy historical trading activity.

Support and resistance levels aren't precise, guaranteed barriers; they're zones reflecting historical price behavior that may or may not repeat, and a level that previously acted as resistance can later act as support once decisively broken through — a role-reversal pattern technical analysts specifically watch for. Support and resistance underpin many other technical analysis concepts, including a breakout (see Kaavon's "Breakout (and Breakdown)" glossary definition), which specifically refers to price decisively moving past one of these levels.

Examples

An asset that has bounced upward from the same price level three separate times has established that level as a notable support zone.
Once a resistance level is decisively broken through, technical analysts often watch for it to flip and act as support on any subsequent pullback.