Support and Resistance
Support and resistance are price zones on a chart where buying or selling interest has historically clustered, causing price to pause, slow, or change direction. A support zone is an area below the current price where demand has previously tended to absorb selling, while a resistance zone is an area above the current price where supply has previously tended to cap advances. On NSE cash and F&O charts these zones are commonly identified from prior swing highs and lows, round numbers, prior session highs/lows, and high-volume price areas.
Also called: Support & Resistance, Support Resistance, S&R, SnR, S and R, support resistance levels, supply and demand zones
Formula
Support and resistance are zones read from price history rather than a single equation, but floor-trader pivot levels are one standard way to derive candidate levels from the prior period's High, Low, and Close: Pivot (P) = (High + Low + Close) / 3; Resistance 1 (R1) = 2P − Low; Support 1 (S1) = 2P − High; Resistance 2 (R2) = P + (High − Low); Support 2 (S2) = P − (High − Low).
How it is read
Traders commonly read these zones as areas where prior order flow has clustered, so price reactions near them are watched for context. A level that price has touched and reversed from several times is often described as more "tested," and many participants treat support and resistance as bands rather than exact single prices because real fills cluster in a range. When price moves decisively through a zone, that former resistance is often described as potentially acting as support afterward, and vice versa, a behaviour usually called a role reversal or flip.
What it does not tell you
Support and resistance describe where reactions have happened in the past; they do not tell you whether, when, or how strongly price will react there again, and they make no prediction about future direction. The zones are subjective, since two analysts can draw them differently from the same chart, and they say nothing on their own about volume confirmation, news, expiry-day dynamics, or liquidity. Price frequently overshoots a zone intraday before settling, and a level holding once is not evidence it will hold again; treating these zones as guarantees is a common misreading.
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