Support Levels
Support levels are a key concept in financial markets. They refer to the price at which a security or asset is expected to find support, or a floor, and not fall any further. This is usually determined by the market’s previous performance and the current market sentiment. Support levels are used by traders to identify potential buying opportunities, as well as to set stop-loss orders.
History of Support Levels
Support levels have been used by traders for centuries. In the early days of trading, traders would use support levels to identify potential buying opportunities. This was done by observing the market’s previous performance and the current market sentiment. As trading evolved, traders began to use more sophisticated methods to identify support levels, such as technical analysis. Technical analysis uses chart patterns and indicators to identify potential support levels.
Comparison Table
| Support Level | Price |
|---|---|
| Strong Support | $50 |
| Moderate Support | $45 |
| Weak Support | $40 |
Summary
Support levels are an important concept in financial markets. They refer to the price at which a security or asset is expected to find support, or a floor, and not fall any further. Support levels are used by traders to identify potential buying opportunities, as well as to set stop-loss orders. To learn more about support levels, traders can visit websites such as Investopedia, The Balance, and Investing.com.
See Also
- Resistance Levels
- Trend Lines
- Moving Averages
- Technical Analysis
- Price Action
- Chart Patterns
- Indicators
- Stop-Loss Orders
- Trading Strategies
- Risk Management
