Chart Patterns
Resistance
A price level where selling pressure prevents further rise.
Full Definition
Resistance is a price level where an asset tends to encounter selling pressure, preventing the price from rising further. It represents a concentration of supply. Resistance levels are identified by looking at historical price action where price has reversed multiple times. When resistance breaks, it often becomes support.
Example
EUR/USD has failed to break above 1.1200 four times. This makes 1.1200 a strong resistance level. Traders might sell near this level expecting rejection, or wait for a confirmed breakout.
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