Resistance

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Resistance

An effective upper bound on prices achieved because of many willing sellers at that price level.

Resistance Level

In technical analysis, a price that a security does not, or only rarely, rise above. Technical analysts identify a resistance level by looking at past performance. When the security approaches the resistance level, it is seen as an indication to sell the security, which will increase the supply, causing the security's price to fall back below the resistance level. If there are too many buyers, however, the security rises above the resistance level. When this occurs, the price of the security will likely continue to rise until it finds another resistance level. It is also called the overhead resistance level. See also: Price ceiling, Support (Support level).

resistance

An increased supply of a security. Compare support.

Resistance.

Resistance, or resistance level, is the top of a stock's current trading range, and the point at which the price is higher than investors are willing to pay. As stockholders sell at resistance level, the stock price goes down because supply exceeds demand.

For example, if, on a repeated basis, as stock A's price reaches $60, stockholders begin to sell, then $60 is considered its resistance level. But a trading range isn't fixed and investor attitudes change, so the resistance level tends to move higher or lower over time.

If stock A rises to $63 without a surge of selling, the current resistance line has been breached. This may be the result of a rising market or a bullish assessment of the stock's value. On the other hand, if selling increases at $57, that may become the new resistance level.

Conversely, the level at which demand exceeds supply and investors typically buy a certain stock is called support. It's the point that's considered the bottom of a stock's current trading range.

Technical analysts use the concepts of resistance and support in anticipating future stock price movements.

References in classic literature ?
These deep recesses, though protected from the winds that assail the summits of their lofty sides, are damp and chill to a degree that one would hardly anticipate in such a climate; and being unprovided with anything but our woollen frocks and thin duck trousers to resist the cold of the place, we were the more solicitous to render our habitation for the night as comfortable as we could.
But she put down the dish of food and the glass of wine in front of him, and when he smelt the wine, he was unable to resist the temptation, and took a deep draught.
At this moment he was lying ill of fever in the clay lands near Curitiba in Brazil, having been drenched with thunder-storms and persecuted by other hardships, in common with all the English farmers and farm-labourers who, just at this time, were deluded into going thither by the promises of the Brazilian Government, and by the baseless assumption that those frames which, ploughing and sowing on English uplands, had resisted all the weathers to whose moods they had been born, could resist equally well all the weathers by which they were surprised on Brazilian plains.
I can't resist them as I ought, if I go back again, and hear your aunt saying what she has been saying for the last half hour and more.
She started early to her first lesson that she might have time to buy the tickets, hoping, as she put a five-dollar bill into her purse, that they would n't be very high, for she felt that she was not in a mood to resist temptation.
It is harder still," I said, "to resist his mother when she is pleading for him.
If she could only have been absorbed again, mind and body, in her good work as a nurse, the temptation might even yet have found her strong enough to resist it.
What armor-plate could ever resist a projectile of 30,000 pounds weight?
We have now to decide how we can best place ourselves to resist the shock.
In this latter case, as long as the rate of subsidence and supply of sediment nearly balance each other, the sea will remain shallow and favourable for life, and thus a fossiliferous formation thick enough, when upraised, to resist any amount of degradation, may be formed.
A very few, as heroes, patriots, martyrs, reformers in the great sense, and men, serve the state with their consciences also, and so necessarily resist it for the most part; and they are commonly treated as enemies by it.
Is it the circumstance of being able and willing to resist temptation; or that of having no temptations to resist?