What they are
- Support is a price level the stock has tended to touch and then bounce up from.
- Resistance is a level the stock has touched and then turned back down from.
These levels are usually drawn from past lows (support) or past highs (resistance). They aren't formulas — they're places on the chart that have visibly mattered in past trading.
Why people watch them
Markets remember. A price where a lot of demand stepped in last time may attract attention again. A price where supply showed up may produce a similar reaction. The level doesn't cause the bounce — it's a focal point where attention concentrates.
What "breakout" and "breakdown" mean
When the price moves through a long-watched resistance level and stays above, traders describe it as a "breakout" (above) or "breakdown" (below support). The volume on the move is part of how people decide whether the break is significant.
What they aren't
Support and resistance describe past behaviour, not future. A "strong" support level can still break; a long-watched resistance can be sliced through on news. They're a way of organising what the chart did, not a forecast.