What impact do support and resistance levels have on Bitcoin's price?

1 answers

• Dec 16, 2021 · 3 years ago
  Support and resistance levels are widely followed by traders and analysts in the cryptocurrency market, including BYDFi. These levels are based on the concept that historical price levels tend to repeat themselves. When the price approaches a support level, it indicates that there is a higher probability of buying pressure outweighing selling pressure, which could lead to a price increase. Conversely, when the price approaches a resistance level, it indicates that there is a higher probability of selling pressure outweighing buying pressure, which could lead to a price decrease. Traders use these levels to identify potential entry and exit points for their trades. However, it's important to note that support and resistance levels are not foolproof indicators and should be used in conjunction with other technical and fundamental analysis tools for better decision-making.
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