Support describes an area where a decline previously paused or reversed. Resistance describes an area where an advance previously paused or reversed. Marking these areas helps organise a chart; it does not create a floor or ceiling that prices must respect.

Use an Observable Definition

Start with a stated timeframe and a rule for selecting prior swings. A swing that requires later candles for confirmation was not known at its turning point. Record when each level became available to avoid hindsight in historical tests.

Previous session highs and lows are another reproducible reference, provided the session is defined. Round numbers can also be marked, but their familiarity does not prove that sufficient orders remain there to affect the next move.

Decide whether you use a line or a zone and how wide a zone is. A $0.25 allowance means something different on a $5 stock and a $500 stock. Keep the rule consistent instead of expanding the zone after every near miss.

Repeated Touches Do Not Prove Strength

Several past reactions show that the area mattered in those observations. They do not establish that each additional touch makes the next bounce more likely. The opposite claim—that each touch necessarily weakens a level—is also not something a price chart proves.

Volume shows activity in the selected feed and period. It cannot identify “institutional defence” of a level by itself. An all-time high is a historical reference, not an ultimate barrier.

Two Different Hypotheses

A bounce strategy expects price to move away from the area. A breakout strategy expects it to move through and continue. Each needs its own entry timing, invalidation and exit rule. A broken level may later act in the opposite role, but that retest is a possibility rather than a reliable law.

Waiting for a candle close instead of entering on the first crossing changes both price and timing. Test whether that filter improves net outcomes rather than assuming it removes false breaks.

For an illustrative long entry at $50.20, a $49.60 stop trigger and a $51.40 target create $0.60 planned price risk and $1.20 target distance per share before costs. This 2-to-1 ratio says nothing about how often the target will be reached. A gap or poor fill can exceed the planned loss.

Make the Chart Review Useful

Keep a screenshot made before entry, the rule used to mark the level and the eventual outcome. Include failures and skipped trades. If you add a moving-average or candlestick filter, compare the amended rules separately; more conditions are not automatically more evidence.

Use position sizing to connect the chosen invalidation distance to an account-level money budget, with room for costs and execution uncertainty.

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