Posted by emilie on .
#1 discuss some disadvantages of technical analysis.
#2 explain the reasoning behind a support level and a resistance level.
#1 Being based entirely upon previous price patterns of the stock rather than fundamental analysis of events, prospects and balance sheets, technical analysis is often wrong.
#2 A support level is a low stock price that has been reached several times but not penetrated on the downside. A resistance level is a high stock price that has been reached several times but no exceeeded.