From Financial Modeling Prep: 2025-01-30 09:43:11

Technical analysis is crucial for traders to predict price movements using historical data. Support and resistance levels are key concepts in this approach. Support is where buying interest prevents price drops, while resistance is where selling pressure stops price increases. Identifying these levels helps traders make informed decisions and analyze price action.

To identify support and resistance levels, traders can analyze historical price data, use trendlines, moving averages, volume analysis, and Fibonacci retracements. These tools help spot potential reversal points and dynamic levels. For real-time support and resistance levels, traders can utilize FMP’s Technical Indicators API for various securities.

In trading strategies, traders can use support and resistance for breakout trading, range trading, and setting stop-loss and profit targets. Avoiding common mistakes like ignoring false breakouts, misidentifying levels, and not considering market context is crucial for successful trading. Mastering support and resistance improves market timing and risk management for technical traders.



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