Who it's for — Anyone going long at highs without context. Resistance marks an area where price has met selling before — useful for entries and take profit.
Resistance is a zone where the market has shown enough supply to stop or reverse an up move. It comes from prior highs, supply zones or psychological levels.
In simple terms — A band where sellers previously dominated. On retest, price may slow, reject — or, if broken with volume, flip to support.
Why resistance "works"
Concentration of supply and market memory:
- Profit-taking from longs
- Short entries or hedges
- Limit sell orders at the level
- "Break-even" sales from positions stuck at the level historically
Operational rules
| Rule | Detail |
|---|---|
| Zone, not laser | Price band with tolerance on tests |
| Repeated tests | Can weaken the level until breakout |
| Polarity flip | Broken resistance → often support on retest |
Common mistake — Aggressive long at all-time highs without volume confirmation or a plan if the level rejects.
Summary
Bronze path — Module: How price moves. Next: Breakout. Index: Bronze path.