Zone Of Support

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Dictionary Says

Definition of 'Zone Of Support'

A price zone in which a stock finds support and begins to trade upward once again. In technical analysis, support occurs not at a finite point, but in a zone. The "density" of the zone of support (how far the price can move down through it) depends on the volume of trading as the price approaches and enters the zone. The higher the volume of trading in the zone of support, the higher the point at which actual support will most likely occur.
Investopedia Says

Investopedia explains 'Zone Of Support'

As the price of a security falls toward a zone of support, it is a test: how far the price moves down through the zone will be an important indicator for future attempts to pass through it.

It is important to note that even though higher volume can raise the actual support point within the zone, the chance of the support zone being wiped out is also higher.

When trying to catch the bottom of a retracement, it is imperative that stop-loss orders be used.
Search results for

'Zone Of Support'

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    http://www.investopedia.com/articles/trading/03/082003.asp
    ... For example, a strong zone of resistance, once broached, becomes a psychological
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  • Capitalize On False Breakouts In The Danger Zone

    http://www.investopedia.com/articles/trading/10/false-breakout-danger-zone.asp
    ... When a security enters the danger zone, watch for signs of weakness. ... For more
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  • Pivot Strategies: A Handy Tool For Forex Traders

    http://www.investopedia.com/articles/forex/05/FXpivots.asp
    ... support. Once the pivot was broken, prices moved lower and stayed predominately
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  • Using The VIX For Shorting Opportunities

    http://www.investopedia.com/articles/technical/04/022504.asp
    ... Short sellers need to understand support levels, and be prepared to buy back into
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  • How To Use Gann Indicators

    http://www.investopedia.com/articles/trading/08/gann-indicator.asp
    ... price. These are called price clusters. The more angles clustering in a
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  • How To Place Orders With A Forex Broker

    http://www.investopedia.com/articles/forex/07/forexorders.asp
    ... In this case, you can place a limit-buy order a few pips above that support level
    so ... Note that these orders will only accept prices in the profitable zone. ...

  • November 25, 2011 Market Summary

    http://stocks.investopedia.com/stock-analysis/cotd/DIA20111125.aspx
    ... is now quite oversold and is pressing into the prior congestion zone formed during ...
    ETF also started the week by slicing through a possible support level near ...

  • How To Build A Trading Indicator

    http://www.investopedia.com/articles/trading/04/120804.asp
    ... (For more basics, check out Support & Resistance Basics.) For example, when using
    the breadth ... When the line is in the median zone, there is little momentum. ...

  • November 18, 2011 Market Summary

    http://stocks.investopedia.com/stock-analysis/cotd/DIA20111118.aspx
    ... SPY remains in a neutral zone here, but any more near-term weakness would likely ...
    its October breakout area near $116, and this level has held as support on a ...

  • 4 Stocks To Watch This Week

    http://stocks.investopedia.com/stock-analysis/2012/4-Stocks-To-Watch-This-Week-NR-BIP-V-EXPO0116.aspx
    ... buying the stock, and when it enters that zone, hit the buy button. Unfortunately,
    many investors struggle to buy when a stock pulls back to support, as they ...

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