Is it Real, if the mirror of supply and demand are support and resistance
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Thread: Is it Real, if the mirror of supply and demand are support and resistance

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    Registered user Agustina's Avatar
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    Is it Real, if the mirror of supply and demand are support and resistance

    [lang=id]Often when we look at the chart the price only moves up to a certain point, then back, then down, Rebounce again, and so on. like there was a wall in that price , are you feel like that?

    Ok, lets to know more in detail:

    • The basic principle the reason of the price down because there are selling activity, because there are selling then supply on the market increases, and under the laws of economic balance, if the supply increases then price will go down. Is it true, try to imagine. if not correct me .
    • Another cases basic principle the reason of the price up because there are buying activity, because there are buying then demand on the market increases, and under the laws of economic balance, if the demand increases then price will go up. Is it true, try to imagine. if not correct me .


    Well, the next question, why do they sell or buy at that price? why not in another price. in this case at pecific price there are supply and in another hands also there are demand at specific price

    In the financial markets, it is called support and resistance. if this true, the initial conclusion: the support and resistance is a mirror of supply and demand.

    Let's go to the next step:

    • Support Point is a certain point which is psychologically a lot of people will buy the instrument, simply where prices will Rebounce after down.
    • Resistance Point is the opposite of support, that is a certain point which is psychologically a lot of people selling the instrument, simply where prices will back again after up.


    __________________________________________________ ___________________________

    A Simple story about the logic of supply and demand that could create support and resistance .

    Supposing you are stockpiling oil. Price of 1 July was 10 000 per bottle. On July 3, the price up till 12 000 per bottle. Of course you are not directly buy at the price of 12 000. You will wait for the price down a bit, then buy again. It turned out that on July 5, the price drops to 10 000. So psychologically, you would think , wah, has gone down as before, this is the time I bought . "Equally, in forex also apply this principle . well EURUSD has dropped as low as last week, this is the time I bought."

    That is the principe of supply

    then what about the principe of demand, it is:

    Well it turns out on July 7, the oil price up till 15 000 per bottle, and then on January 9, fell to 12000. Then on July9, psychologically, there will be mind to buy oil (the premise: to have gone down a lot, and hard if you want to go down to 10000 again ...), then buy again at 12 000.

    Then on July 10, the price of oil so 15 000, then you would think (wah, the price very expensive,, same as when the price of the most expensive), then you will take off to sell oil, because naturally, you would think 15 000 it most expensive and perhaps further price will not rise more than 15 000 again.

    From there we can take point : The price at 10 000 as support and price at 15 000 as resistance.

    __________________________________________________ __________

    only that I have, hopefully you gain insights into this case, this can you make basic decisions or as a supporting way to your system

    henceforth may we continue on mechanically how to determine the zone of supply and demand on the forex as support and resistance.[/lang]

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    Trader Hukam's Avatar
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    Nice thread mate, this is good explanation of demand and supply and support and resistance in this thread. Actually the learning of forex trading market is not very tough at all, trader's can learn about both demand ands supply and support and resistance, this kind of method would give them a galore success in forex. Along with it the psychology also important for us. By the way put some screenshots in your thread then it would be more helpful for forum members.

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    i think that support and resistance are a mirror for supply and demands because we can consider both are near or the same, but i think that that support and resistance are many on the chart but the real supply and demands zone are little but more effective for trading and more profitable because it is not on near levels as the support and resistance.

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    Registered user Agustina's Avatar
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    Quote Originally Posted by sameeh View Post
    i think that support and resistance are a mirror for supply and demands because we can consider both are near or the same, but i think that that support and resistance are many on the chart but the real supply and demands zone are little but more effective for trading and more profitable because it is not on near levels as the support and resistance.
    [lang=id]Thanks for good response , yes in my observe most of the traders to determine the direction maket further using reference support resistance, cause with guided at this technique will be expected to conform to the basic principles of business, buying at cheap price and sell at high price, then the answer is with determine at early the support resistance, this technique actually can be said to be simple because it can be easily seen on the chart, then there is only draw horizontal lines, in other had use the trendline, or even just use the MA to see the trend and also to make the support resistance , so the movement would be seen easily[/lang]

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    Trader cutiekc's Avatar
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    That is the basis and the truth about support and resistance levels, that is how I see it, in forex trading market, there is no way we would be able to succeed without getting to know what the support and resistance levels are. We need to have them applied to the way we trade, that is the only way and means we can succeed.

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    Support and Resistance is where we see a lot of failed attempts for price to move beyond. very classic idea that a lot of people recognize. supply and demand is much deeper idea, though. we're not looking for a line where price had trouble moving through, we're looking for areas of strong price movement away from a zone of price action. my favorite of these are areas for example are where we saw a very strong rally, a little bit of sideways movements as buyers and sellers came to temporary equilibrium, and then a massive drop once all the buyers were filled and only sellers were left. the result a zone where we have a good idea that there aren't going to be many buyers and probably quite a few sellers remaining.

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    Quote Originally Posted by Agustina View Post
    [lang=id]Thanks for good response , yes in my observe most of the traders to determine the direction maket further using reference support resistance, cause with guided at this technique will be expected to conform to the basic principles of business, buying at cheap price and sell at high price, then the answer is with determine at early the support resistance, this technique actually can be said to be simple because it can be easily seen on the chart, then there is only draw horizontal lines, in other had use the trendline, or even just use the MA to see the trend and also to make the support resistance , so the movement would be seen easily[/lang]
    Yes sir before using the support and resistance we should also look upon the concept of demand and supply so that we can use those support and resistance properly for buying and selling the concept of demand and supply is totally related with the support and resistance. This is one fo the popular and easy way to predict the market but psychology could be the problem for trader's after the good use of analysis.

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    Quote Originally Posted by cutiekc View Post
    That is the basis and the truth about support and resistance levels, that is how I see it, in forex trading market, there is no way we would be able to succeed without getting to know what the support and resistance levels are. We need to have them applied to the way we trade, that is the only way and means we can succeed.
    I do not agree on what you have said, not all traders will work with the support and resistance, and the strategy i am using now can prove that to you over and over again. Traders have many trading strategies in the market, and not all strategies will be working with the support and resistance ways. This can not be the only way to success.

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    No thats not true first because there would be a very sharp decline when it comes to trading of forex there is a source that makes forex really work for the right idea and for good issues the supply and demand is created by perception and in forex perception is everything these works well for us if we are able to stand tall in a lot of things

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    Quote Originally Posted by Sylvertee View Post
    I do not agree on what you have said, not all traders will work with the support and resistance, and the strategy i am using now can prove that to you over and over again. Traders have many trading strategies in the market, and not all strategies will be working with the support and resistance ways. This can not be the only way to success.
    i guess support resistance becomes the basic for all trading strategies and although for them who follow the trend, because these are the points for them to enter and exit from the market at the right time that will help them to minimize the risk or maximize their earning too

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