$BURGER /USDT

Spot and Resistance in Trading

In trading, understanding spot prices and resistance levels is crucial for making informed decisions. The spot price refers to the current market price of an asset, whether it’s a stock, commodity, or currency, at which it can be bought or sold for immediate delivery. Spot prices are influenced by real-time supply and demand dynamics, and they change constantly during market hours.

On the other hand, resistance is a price level where an asset tends to face selling pressure. It’s a point where the upward trend pauses or reverses because many traders decide to sell, believing the asset is overvalued at that level. Resistance is a psychological barrier, and breaking through it often indicates the potential for further price increases.

Traders use these concepts together to form strategies. If an asset is trading near its spot price and approaching a known resistance level, traders might anticipate a reversal and sell, or they may wait for a breakout to buy, expecting further gains. Combining technical analysis with these price points helps traders better predict market movements, manage risk, and capitalize on potential profit opportunities.

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