The fundamental principle of price behavior lies in the concept of supply and demand, governing the existence and operation of any market.
When demand outweighs supply, it prompts an upward push in prices, while in reverse circumstances, a decrease is observed. By identifying levels of supply and demand, traders significantly enhance their success rate.
A support level indicates a price range where strong buying positions are concentrated, typically defined by two minimum price points.
A resistance level, conversely, denotes a price range around which strong selling positions are clustered, often marked by two maximum price points.