Support and resistance
In short
#TradingSupport is a price level where buying has repeatedly stopped a fall; resistance is where selling has repeatedly stopped a rise. They are zones drawn from past reactions, not fixed prices.
Why it matters
Almost every entry, target and stop you hear quoted is anchored to one of these levels, so the vocabulary is unavoidable. They work partly because enough participants place orders at the same obvious levels. Treating them as precise numbers rather than zones is the usual error. A level that held at $48.10 and $47.85 is a band, not a line.
Example
A stock bounces near $50 three times over six months. Traders call $50 support and place stops just below it, so a clean break under $50 tends to trigger a cluster of selling.
Frequently asked
Why does broken support become resistance?
Buyers who bought at that level are now at a loss and often sell when price returns to break-even. That supply above the level turns the old floor into a new ceiling until it is absorbed.
How reliable are these levels?
They are descriptive, not predictive. The more times a level has produced a reaction and the higher the volume there, the more participants are watching it, which is the only real mechanism behind it.