What is a resistance level?

A resistance level represents a price point or price zone that an asset has had trouble breaking above in the time period being considered. A resistance level may be several points wide, due to multiple attempts to break above the resistance, potentially forming a resistance zone and sending prices lower.

What is a resistance zone?

Resistance can also be a zone, meaning an area several points wide, such as $0.50/$1.00. A resistance zone represents a test of the resistance level, which may be broken by a small amount, but ultimately turns back the price advance, leaving the resistance level essentially intact.

What does resistance mean in physics?

Put simply, resistance is a force that counteracts the flow of electricity. Resistance influences the flow of electricity. This page offers basic knowledge about resistance, along with a detailed explanation of topics such as calculation methods and resistors. What is resistance?

What happens if a security reaches a resistance level?

In a healthy market, most securities tend to go up in value over the long term. For this reason, resistance may increase, so selling when a security reaches a previous resistance level could cause an investor tomiss out on additional gains.