Why Does Market Bounce At Support Levels Before Falling?
Infosys Limited, a leading Indian IT services and consulting firm, is a prime example of how markets react around crucial support levels. Investors track Infosys closely, given its role as a bellwether in India’s technology sector. Whenever Infosys stock approaches a support zone, traders observe sharp reactions, with either a bounce or a slow grind downward, depending on the strength of buyer presence at that price point.
What Happens When Market Approaches Support?
At support, supply from sellers meets demand from buyers. As long as buyers are willing to absorb the supply, markets tend to hold firm. The bounce from these zones signals bullish intent and discourages premature shorting.
How Does Supply Absorption Lead To Market Falls?
The psychology here is simple. If buyers no longer defend the level, sellers gain control. Once support cracks, short-sellers use pullbacks to enter trades, often making quick gains as weak hands exit.
Why Do Bulls Profit More Around Support?
Bulls thrive on investor fear. They accumulate positions at levels where others expect breakdowns, taking advantage of short covering and renewed optimism to secure profits. This cycle repeats until supply finally overwhelms demand.
Pullback Shorts After Breakdown
Pullback shorts are favored by experienced traders because they allow entries at better prices. Instead of chasing breakdowns, they wait for failed retests. This ensures risk remains defined while maximizing profit potential.
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Investor Psychology At Support Levels
Investors who panic sell at support often regret missing rebounds. On the other hand, those who average their positions carefully benefit from accumulated buying power. This constant push and pull defines the volatility at such levels.
Investor Takeaway
Markets bounce at support because buyers are still active. Falls occur only when supply absorption is complete. Traders should avoid rushing into shorts until confirmation comes from broken levels. Recognizing this dynamic helps investors align with prevailing momentum. 📌 Explore more insights freely at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
