Resistanssitasot

Resistanssitasot is a Finnish term that translates to "resistance levels" in English. In the context of technical analysis in financial markets, it refers to specific price points where a financial asset, such as a stock or currency, has historically faced selling pressure and struggled to move higher. These levels are identified by observing past price action, where the price repeatedly failed to break above a certain threshold, indicating the presence of a significant number of sellers at that price.

Traders and investors use resistance levels as a tool to make informed decisions. When a price approaches a resistance level, it is often anticipated that selling pressure might increase, potentially causing the price to reverse downwards or consolidate. Conversely, if the price manages to break decisively above a resistance level, it can be interpreted as a bullish signal, suggesting that the buying pressure has overcome the selling pressure and the price may continue to rise.

The strength of a resistance level is often determined by how many times the price has been rejected at that level and the volume of trading that occurred there. A resistance level that has held firm on multiple occasions is considered stronger than one that has been tested only a few times. Identifying and understanding resistance levels is a fundamental aspect of technical analysis for many market participants.