Support and resistance are key concepts in technical analysis used to make trading decisions.
- **Support**: It's a price level where a cryptocurrency or any asset tends to stop falling and may even bounce back. It's like a floor that prevents the price from going lower.
- **Resistance**: Conversely, resistance is a price level where an asset often stops rising and might reverse direction. It acts as a ceiling preventing the price from going higher.
Traders use these levels to identify potential entry and exit points. Buying near support and selling near resistance is a common strategy. Breakouts (when the price moves through resistance or support) and breakdowns (when the price moves below support or above resistance) can also signal potential trade opportunities.
Remember, while support and resistance can be useful, no strategy guarantees success in trading. Always consider other factors and use risk management techniques.
