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Intermediate · Lesson 2 of 9

Trends, support and resistance

7 minute read · By Krishna Avadhani, Vestora Academy · Updated 18 October 2026

An uptrend is a series of higher highs and higher lows; a downtrend is lower highs and lower lows. A sideways range moves between a ceiling and a floor.

Support is a price area where buying has repeatedly stopped falls. Resistance is where selling has repeatedly stopped rises. They form because traders remember those prices: people who bought at $20 and watched it fall may sell when it gets back to $20 to "get out even".

When resistance breaks on strong volume, it often becomes support (and vice versa). Treat levels as zones, not exact lines, and expect false breakouts.

Key takeaways

  • Trend = sequence of highs and lows.
  • Support and resistance are zones of memory and orders.
  • Broken resistance often becomes support.

Check your understanding

1. An uptrend is defined by...

  • Lower highs and lower lows
  • Higher highs and higher lows
  • Rising volume only
  • A dividend increase
Show the answer

Higher highs and higher lows. Each peak and trough is above the last.

2. A share breaks above $50 resistance on heavy volume. Later it falls back to $50. Many traders expect $50 to act as...

  • Resistance again
  • Support
  • Irrelevant
  • A dividend date
Show the answer

Support. Old resistance commonly becomes new support.

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General education only, not financial advice. Examples are illustrations. Rules, tax settings and products change; check official sources.