Support

Support is a price area where a stock or other asset has historically tended to stop falling and bounce, because enough buyers step in there to absorb the selling. It's a concept from technical analysis, the practice of studying price charts to guess what price might do next, rather than looking at a company's financials.

You find support by looking at a chart and noticing where price has fallen to before and then turned back up, sometimes more than once. Traders draw a horizontal line (or a zone, since it's rarely one exact price) at that level and watch what happens when price approaches it again. The idea is that traders who missed buying at that price the first time, or who bought there before and want to add more, will place buy orders around the same area again, and that cluster of buying interest can slow or reverse a decline.

The nuance that trips beginners up is that support is not a wall and not a guarantee. It's a description of past behavior, not a rule about future behavior. Price can and does fall straight through a support level, especially on high volume or bad news, and once it does, traders often say that old support has become new resistance, a level where price now struggles to rise back above. Support also gets weaker each time it's tested and holds, because some of the buy orders sitting there get used up.

It also helps to remember that support is somewhat subjective. Two traders looking at the same chart can draw the line in slightly different places depending on which lows they choose to connect, so it's best treated as a rough zone of interest rather than a precise number.