Speed Resistance Lines

Filed Under » ,
Dictionary Says

Definition of 'Speed Resistance Lines'

A tool in technical analysis that is used for determining potential areas of support and resistance. This tool, consisting of three trendlines, is created by drawing the first trendline from the most recent low to the most recent high when the asset is in an uptrend, and from the most recent high to the most recent low when the asset is in a downtrend. The other two trendlines are drawn with smaller angles in an attempt to predict areas that will act as possible barriers in the event of a retracement.

Speed Resistance Lines
Investopedia Says

Investopedia explains 'Speed Resistance Lines'

Speed resistance lines are similar in interpretation to the Fibonacci Fan indicator. Many traders will watch for a move below the two-thirds level to signal a continued retracement toward the one-third level. It is important to remember that other technical indicators should be used when the price of the asset is near the trendline to confirm the strength of the predicted support/resistance.

Related Definitions

  •

    Support (Support Level)

    The price level which, historically, a stock has had difficulty falling below. It is thought of as the level at which a lot of buyers tend to enter the stock. Often referred to as the ...
    Read More »

  • Resistance (Resistance Level)

    The price at which a stock or market can trade, but not exceed, for a certain period of time. Often referred to as "resistance level".
    Read More »

  • Fibonacci Fan

    A charting technique consisting of three diagonal lines that use Fibonacci ratios to help identify key levels of support and resistance.
    Read More »

    • Trendline

      A line that is drawn over pivot highs or under pivot lows to show the prevailing direction of price. Trendlines are a visual representation of support and resistance in any time frame.
      Read More »

    • Retracement

      A temporary reversal in the direction of a stock's price that goes against the prevailing trend. A retracement does not signify a change in the larger trend. On a chart where a stock's ...
      Read More »

    • Technical Analysis

      A method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security's ...
      Read More »

    • Trend Analysis

      An aspect of technical analysis that tries to predict the future movement of a stock based on past data. Trend analysis is based on the idea that what has happened in the past gives ...
      Read More »

    • Trend

      The general direction of a market or of the price of an asset. Trends can vary in length from short, to intermediate, to long term. If you can identify a trend, it can be highly ...
      Read More »

    • Exponential Moving Average - EMA

      A type of moving average that is similar to a simple moving average, except that more weight is given to the latest data. The exponential moving average is also known as "exponentially ...
      Read More »

    • Simple Moving Average - SMA

      A simple, or arithmetic, moving average that is calculated by adding the closing price of the security for a number of time periods and then dividing this total by the number of time ...
      Read More »

Articles Of Interest

Sponsored links
Hot Definitions
Partner Links
Suggested Definitions