What does Support mean?
Support is a price zone where downward movement has previously stalled or where buying interest may become more relevant. Like resistance, it is usually better treated as an area rather than an exact price.
Why it matters
- Support can help identify potential reaction or structural areas.
- A decisive break below support can signal a change in market structure.
- Former support can sometimes become resistance after a breakdown.
How it works
- 01
A prior swing low, range boundary or repeated reaction area is identified.
- 02
Price later returns toward the zone.
- 03
The market either rejects the zone, trades through it or accepts below it.
Example
If price repeatedly reacts near 20,000, traders may consider the area support. A later sustained move below it can show that the prior support has failed.
Common misunderstandings
- Support does not guarantee a bounce.
- The level is usually a zone rather than one exact tick.
- A broken support level can remain relevant in a different role.
Educational reference
This glossary explains terminology and
general market concepts. It is not a
trading signal or a guarantee of future
results.