Resistance
Technical Analysis
What it means
A price level where selling tends to appear and stop a rally. Price has stalled there before, so traders expect it to cap the move again.
Example
A stock rallies to $100 three times and reverses each time. $100 is resistance; traders place sell orders or take profits there expecting another rejection.
Mistake beginners make
Beginners short resistance blindly, but resistance is only a level, not a signal. Shorting it without a confirmation candle leads to losses when price finally breaks out.