Final answer:
In technical analysis, the condition that exists at a support level for a stock is an equilibrium wherein the buying interest is sufficient to hold the stock's price from falling below a certain level. Expectations of the market participants play a crucial role while the actual future news and fundamental changes will influence whether these expectations hold true.
Step-by-step explanation:
In technical analysis, a support level represents a price level at which a stock typically does not fall below for a certain period of time. This is because at this level, there is a sufficient condition of demand or buying interest that outweighs the selling pressure. It is believed that the condition at a support level is theoretically created by the collective and self-fulfilling expectations of the market participants who presume that the stock will not drop below this level. These investors start buying the stock at or near the support level, anticipating that the stock price will hold firm and potentially increase.
The persistence of a support level is heavily contingent on traders' expectations. As per your quote, these expectations can shift and are based on the future potential of the stock. Therefore, while technical analysis helps in identifying patterns and support levels, ultimately, it's the changing expectations and news that cause price movements, sometimes confirming and at other times breaking past these supposed support or resistance levels due to the nature of the market performing a random walk with a trend.