Resistance

Resistance is a crucial concept in technical analysis, referring to a price level where an asset faces strong selling pressure, preventing it from rising further. Traders often identify resistance to gauge potential price reversals or breakouts. When an asset's price approaches this level, sellers are likely to emerge, increasing supply and causing the price to stall or reverse. Recognizing resistance can aid in making informed trading decisions, as breaking above resistance may signal a bullish trend, while failure to do so could indicate continued downward momentum.