A resistance level differs from a support level in that
A) at a resistance level most investors would hold stock until the price improves; at a support level a stock becomes overvalued and investor interest is likely to decrease.
B) at a resistance level the analyst would expect a substantial increase in the demand for a stock; at a support level the analyst would expect a substantial decrease in the demand for a stock.
C) at a resistance level most investors would sell a stock; at a support level most investors would be willing to purchase a stock.
D) Choices a and
E) None of the above.

Question

Quizplus · Accepted Answer

A resistance level is a price level at which a stock price tends to stop rising due to the selling pressure from investors who are willing to sell their shares at that price. In contrast, a support level is a price level at which a stock price tends to stop falling due to demand from investors who are willing to buy shares at that price. Therefore, at a resistance level, most investors would sell a stock, while at a support level, most investors would be willing to purchase a stock.

A Resistance Level Differs from a Support Level in That