We
all want consistent profits, lifelong income from speculating in
markets. Anyone can have profitable trades here and there but do they
produce consistent returns year after year? The goal in this article is
to get right to the point of focusing on the two most important things
in trading/investing that lead to consistent returns.
OTA Supply/Demand Grid April 2017: Gold Futures
Let me explain through an opportunity found using our Daily Market Overview service for OTA members. This was a trade in the Gold Futures (GC). Notice the supply level on the chart, shaded in yellow. The supply level is the origin of a strong decline in price and has with it some very key Odds Enhancers that make it a significant level where institutions are likely selling, where supply greatly exceeds demand.
The trade was to figure on a downside move, selling short at the supply level to a novice buyer for a potential move down in price. What made this trade work well are two specific things. First was the quality supply level. Second, notice the rally that brought price up to the supply level where we sold short. There was good news, people started buying in a hurry and price shot up quickly. Notice specifically the big green candles. There is no picture of demand in that rally. This means that when price reached the supply level where we sell short, price was likely to fall just as fast as it rallied because there was no significant demand to stop it from falling.
The supply zone causes the turn in price, the lack of demand causes the movement of price.
Everything you need to see is on the price charts, if you know what you’re looking for. If you have been schooled in the theories of conventional technical analysis, you may be blinded by illusions of chart patterns that never really worked for anyone. Have no fear, there is a cure. Remove everything from your charts except price and price alone. My hope is that today’s little nugget of information helps you achieve the consistency you’re looking for.
Hope this was helpful, have a great day.
Source:
https://www.fxstreet.com/education/the-only-two-things-that-matter-in-trading-201705170705
- Quality Supply and Demand Zones: To identify market turning points and market moves
in advance with a high degree of accuracy, you need to know where
institutions and banks are buying and selling in the markets. To
accomplish this, you must be able to quantify any market’s real supply
and demand by looking at a price chart.
- A Clear Profit Zone:
Just as it is important to identify strong supply and demand zones on a
chart. It is equally important to be able to identify areas on the
price chart where there is very little supply or demand. These are the
areas where price will move quickly through.
OTA Supply/Demand Grid April 2017: Gold Futures
Let me explain through an opportunity found using our Daily Market Overview service for OTA members. This was a trade in the Gold Futures (GC). Notice the supply level on the chart, shaded in yellow. The supply level is the origin of a strong decline in price and has with it some very key Odds Enhancers that make it a significant level where institutions are likely selling, where supply greatly exceeds demand.
The trade was to figure on a downside move, selling short at the supply level to a novice buyer for a potential move down in price. What made this trade work well are two specific things. First was the quality supply level. Second, notice the rally that brought price up to the supply level where we sold short. There was good news, people started buying in a hurry and price shot up quickly. Notice specifically the big green candles. There is no picture of demand in that rally. This means that when price reached the supply level where we sell short, price was likely to fall just as fast as it rallied because there was no significant demand to stop it from falling.
The supply zone causes the turn in price, the lack of demand causes the movement of price.
Everything you need to see is on the price charts, if you know what you’re looking for. If you have been schooled in the theories of conventional technical analysis, you may be blinded by illusions of chart patterns that never really worked for anyone. Have no fear, there is a cure. Remove everything from your charts except price and price alone. My hope is that today’s little nugget of information helps you achieve the consistency you’re looking for.
Hope this was helpful, have a great day.
Source:
https://www.fxstreet.com/education/the-only-two-things-that-matter-in-trading-201705170705
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