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Horizontal Support LinesHORIZONTAL SUPPORT AND RESISTANCE LINES


HORIZONTAL SUPPORT AND RESISTANCE LINES



Horizontal support / resistance lines are formed when a stock touches and bounces at, or very near, the same price level. As with drawing any trendlines and support/resistance lines, it is not a perfect science. If itís close, it counts. Look for volume spikes on the candles where it hits support or resistance for extra verification. And understand that at some point support/resistance will fail to hold and the stock will move through it. It may eventually come back to retest the support/resistance level, and this becomes another great place to enter a trade.