Trader's Glossary

Support Level

When charting an asset’s price action, support is a price level which the market seems reluctant or unwilling to fall below. In other words it is a level at which buying is likely to occur. Traders often use recent lows to plot support lines on the charts they are monitoring because they can be good indicators of an imminent trend reversal. The more times an asset’s price fails to drop below a support level the more that support level is reinforced.