Definition: Resistance is a price level where a stock tends to stop rising and may start to decline. It acts like a “ceiling” for the stock’s price.
Why It Happens: At the resistance level, there is generally enough selling interest to prevent the price from rising further. Sellers are more willing to sell the stock at this level, creating supply.
Example: If a stock has repeatedly failed to break above $100, then $100 is considered a resistance level.
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