Hi guys.I only need to share my fundamental understanding about demand and supply in market and the way I use it for Forex trading.Hope can share and learn from every one of u as I learn from others.This is simply beginning of price action understanding.If u need more could view RED n TRADE PRICE thread.
Back to fundamental
Maybe you remember the two people whose names figure often mentioned in the field of economics and bodily. Initially was Adam Smith, the leader of contemporary economics and a pioneer of economic system of capitalism. He has stated tens of thousands of years back which if supply exceeds demand at a certain price level, prices will fall, and vice versa. While the next is Sir Isaac Newton's law of motion says that an item will remain in action motion (movement ) to obtain reaction force (force) is equivalent to or higher. More often called the Action and Reaction only. Both instances are simple but wise of time-tested and was a major element in price movements on the market which we are trading and engaging in it. The focus of the paper is on what's called the conventional technical analysis as a service (requirement ) and resistance (supply). More will be examined by us in what service and resistance are, how we identify and quantifiion on the chart, and also how to use them in making decisions so as to generate profitable trading.
A trader should see that the market mechanism is no more and no with other market we know. We've seen how the law of distribution need to work with human factors involved. This is the principal staple driving prices, and chances arise when these relationships become unbalanced. If only we are willing to discover the interaction of demand and supply is always there every moment, if the identifiion process will reverse the direction the price is not overly difficult.