Support lines are like tightropes between hills Support and resistance lines drawn on technical charts are widely used in predicting bounce points and reversals. Oftentimes, if you are monitoring a particular chart and its price movements, you will realize that there will be some resistance when the stock or index tried to fall below or rise above a support or resistance line respectively. While some might argue that these phenomena can be psychological in nature as the person who positions the line might be biased. However, if drawn accurately, it has also proven to be a useful way to plan for entries and exits at times. In this week’s post, we will be going through a few types of support lines used on actual stock or index charts to demonstrate their effectiveness and usefulness in reality. Psychological Support levels Price lines drawn are in the
How unreliable are support lines?
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