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FUNDAMENTAL OUTLOOK- SEPTEMBER (24-28)2018.

 

EDUCATION: SUPPORT AND RESISTANCE IN-DETAIL.

    Support and resistance levels are simply prices at which the people trading the market feel that the market likely won’t pass through easily. Support levels are prices that traders feel the market is unlikely to go below. Resistance levels are prices that traders feel the market is unlikely to go above. IMPORTANCE OF SUPPORT AND RESISTANCE. Support and resistance levels are a critical part of trend analysis because it can be used to make specific trading decisions and identify when a trend is about to reverse. For example, a trader might identify an upcoming support level and decide to start buying the stock as it approaches knowing that it will likely rebound higher. These levels both test and confirm trends and should be closely monitored by anyone using technical analysis. As long as the price remains between these two levels, the trend is likely to continue in the prevailing direction. However, a break beyond support or resistance does not always indicate a reversal. For example, a breakout higher may be the start of a faster bullish trend and vice versa for a breakdown below trendline support. There is also an instance of ‘false breakouts’ when a price may […]