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Support and Resistance

50
'Support' and 'resistance' are terms for two respective levels on a price chart that appear to limit the market's range of movement. The support level is where the price regularly stops falling and bounces back up, while the resistance level is where the price normally stops rising and dips back down.

The basic strategy is to buy at the support level and sell at the resistance level, recognizing that these are zones of potential demand and supply changes. How does resistance work?

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