*(Support and Resistance in)*

Support and resistance are foundational concepts in technical analysis, widely used in crypto markets to forecast price movements and inform trading strategies.

Support is a price level where a cryptocurrency tends to find buying interest as it declines. It acts as a “floor” that prevents the price from falling further. This occurs because traders often believe the asset is undervalued at that level, prompting increased demand.

Resistance, conversely, is a level where selling interest typically increases as the price rises. It acts as a “ceiling” that the asset struggles to break through. Traders might see the asset as overvalued at this level and start selling to take profits.

These levels are not absolute. A break below support or above resistance can signal a shift in market sentiment, often leading to accelerated price movements. For example, if Bitcoin breaks a key resistance, it may trigger a buying spree, known as a breakout.

In crypto markets—known for high volatility—support and resistance levels can shift quickly. Traders use tools like moving averages, trendlines, and volume indicators to identify and confirm these zones.

Understanding support and resistance helps traders set better entry and exit points, manage risk, and anticipate potential price movements in the fast-paced world of digital assets.