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What are support and resistance?
Support and resistance are price levels on a chart where, in technical analysis, a falling price has tended to stop falling (support) or a rising price has tended to stop rising (resistance), because buyers or sellers have appeared there before.
What it means for you
Support and resistance describe where prices turned in the past; they do not tell you what happens next. Levels are drawn by eye, and two people can draw different ones. A price can also cut straight through a level, and stop orders clustered there can cascade into a sharp move and a fill far from the line.
How it works
The CFTC defines support as a price area where new buying is likely to come in and stem a decline, and resistance as a price area where new selling will emerge to dampen a continued rise. Some indicators draw these lines automatically. Bollinger Bands, for instance, set a middle band at the 20-day simple moving average and upper and lower bands two standard deviations away, which analysts treat as resistance and support lines. Exchanges have added safeguards against excessive price moves caused by cascading stop orders.
Sources: CFTC Glossary, Ma, Ventre and Polukarov: Denoised Labels for Financial Time-Series Data via Self-Supervised Learning (arXiv) · checked 4 October 2026
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Educational content, not financial advice. Written by hand and checked against the source named above. Something wrong? Tell us and we reply within two business days.