Key Price Points - Support and Resistance
Support and resistance is where supply meets demand in the trading of any financial instrument. Prices are driven up by the force of demand and subsequently pushed down by the force of supply. As demand increases, supply decreases and prices begin to rise. As demand decreases, supply increases and prices begin to fall.
The following chart of APOL shows support and resistance drawn into the chart. Support and resistance can be drawn on multiple time frames. The more times price hits a particular support or resistance, the stronger those points will be.
Points that appear at the same price across multiple time frames are usually strong areas of support and resistance.
