The low price in candlestick charting is the bottom of the lower wick, or the bottom part of the body if there is no wick. It represents the lowest point at which the bears were able to force a stock down before the bulls halted the onslaught and fought back.
The low of the previous day serves as the first area of short-term price support. Stop-losses for longs often accumulate just beneath the low price of the previous and current trading day. New lows for longs represent new losses, some of which may be intolerable to traders, forcing them to liquidate their positions.
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