What It Represents
A resistance line connects levels where the price has stopped rising on multiple occasions in the past. Because sell orders are thought to have tended to come in around that level, some expect upside to be capped again in a similar way when the price approaches it once more.
How to Read It, and What to Watch Out For
A resistance line is only a guideline drawn from past price movement — it does not guarantee that the price's rise will stop at that level. Changes in market conditions or supply and demand can cause the price to break above the line and keep rising, so it should be used only as a reference alongside other information.