Below is a simple graph showing the maximum speed before you will require a 120 Ohm termination resisitor for RS422 / RS485 circuits. You can use this graph to figure out if you need a termination resistor, depending on the length of cable and the bit rate you are need.
Termination resistors are required for signal cables because the signal bounces back in copper wires (see Veritasium's The Scariest Chart in Electrical Engineering - YouTube). If the length of the cable is not long enough, this signal bouncing back can cancel out the actual signal. A Termination resistor acts like a damper at the end of the wire, absorbing the signal so it doesn't bounce back.
From a Black Box whitepaper:
Termination is used to match the impedance of a node to the impedance of the transmission line being used. When impedance is mismatched, the transmitted signal is not completely absorbed by the load, and a portion is reflected back into the transmission line. If the source, transmission line, and load impedance are equal, these reflections are eliminated. There are disadvantages of termination as well. Termination increases load on the drivers, increases installation complexity, changes biasing requirements, and makes system modification more difficult.
The decision on whether to use termination should be based on the cable length and data rate. A good rule of thumb is if the propagation delay on the data line is much less than one bit width, termination is not needed. This rule makes the assumption that reflections will damp out in several trips up and down the data line. Since the receiving UART will sample the data in the middle of the bit, it is important that the signal level be solid at that point. For example, in a system with 2000 feet of data line, the propagation delay can be calculated by multiplying the cable length by the propagation velocity of the cable. This value, typically 66 to 75% of the speed of light (c), is specified by the cable manufacturer.
For our example, a round trip covers 4000 feet of cable. Using a propagation velocity of 0.66 × c, one round trip is completed in approximately 6.16 μs. If we assume the reflections will damp out in three round trips up and down the cable length, the signal will stabilize at 18.5 μs after the leading edge of a bit. At 9600-baud, one bit is 104-μs wide. Since the reflections are damped out much before the center of the bit, termination is not required.
There are several methods of terminating data lines. The method we recommend is parallel termination. A resistor is added in parallel with the receiver’s A and B lines to match the data line characteristic impedance specified by the cable manufacturer (120 ohm is a common value). This value describes the intrinsic impedance of the transmission line and is not a function of the line length. A terminating resistor of less than 90-ohm should not be used. Termination resistors should be placed only at the extreme ends of the data line, and no more than two terminations should be placed in any system that does not use repeaters.
This type of termination adds heavy DC loading to a system and may overload port-powered RS-232 to RS-485 converters.
Another type of termination, AC-coupled termination, adds a small capacitor in series with the termination resistor to eliminate the DC loading effect. Although this method eliminates DC loading, capacitor selection is highly dependent on the system properties.
System designers interested in AC termination are encouraged to read National Semiconductor’s Application Note 903 2 for further information. Figure 2-3 illustrates both parallel and AC termination on an RS-485 two-wire node. In four-wire systems, the termination is placed across the receiver of the node.