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Technical Analysis
What is support and resistance in technical analysis?
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29 December, 2014, 3:19 PM
Support and Resistance is the sign of demand and supply. Resistance is an area where sellers are interested to sell the commodity or equity in the other hand Support is an area where the buyers are intersted to buy the commodity or equity or whatever is tradle in market.
A level where market hits the multiple time but not sustain above that level and sudden fall from that level is called Resistance and when market crossed that level at that time traders interested to buy that commodity or equity.
In the other hand a level where market hits the multiple time but not sustain below that level and sudden jump from that level is called support and when market crossed below that level at that time traders interested to sell that commodity or equity.
Resistance become Support and support become Resistance theis is the rule.
You can find the support levels in the indicators also like moving averages, fibonacci retracement.
In Moving averages if you are plotting multiple moving averages, you will get the resistance and support. like you are plotting 10, 20 n 50 moving average then if you are buy accoring to moving averages above 10 days moving averages then 20days moving average will supportive level for you. if 20 days movieng average failure then the next supportive level will be 50days moving averages.
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