When a stock rallies, levels that were resistance can convert to support levels. This is optimistic for stocks and it could happen with Alphabet Inc. (NASDAQ: GOOGL) and Facebook, Inc. (NASDAQ: FB).
This dynamic is due to the remorse of the sellers.
These investors sold their shares at the resistance level, but after they trade at a higher price, they think the sale was a mistake. Many people decide to buy back their shares.
But they will only do this if they can get them for the same price they sold for. This way they can erase their mistake. As a result, they place their buy orders at the sell price.
If there are enough such buy orders, the level that was resistance will turn into a support level. If this happens with GOOGL and FB, the stage is set for another step higher.
For GOOGL, the tier to look at is $ 2390.
The $ 330 level is important to Facebook.
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