Support and Resistance

If trendlines are like hammers, then support and resistance (SAR) are like boards. Price stalls or even reverses at SAR areas and that makes predicting future price trends easier. Fortunately, there are many techniques that show SAR, and this chapter discusses them.

In the fall of 1987, a friend of mine said that she had purchased shares in a mutual fund. This was her first time investing in the stock market, and she was excited!

On black Monday, October 19, 1987, the Dow Jones industrials lost over 22 percent of their value in one session.

She was not excited! In fact, she vowed to sell as soon as she got her money back, ...

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