Excellent post, very well written, I will be following, thank you.
Quick question for you, is the supply / demand zones different to the support / resistance levels? How do you differentiate between them if they are different? Do you use confluence with indicators such as volume?
Thanks :)
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Hello mate.
Support and resistance shows us an area where price has tested a few times and failed to break through.
Supply and demand goes a bit deeper. S/D shows us an area where buyers and sellers are met at a sort of equilibrium and then due to an imbalance in the order books, we see a huge reaction one way or the other. If we rally, can get a good idea that there isn't much selling pressure at that level, and vice versa. S/R can't offer the same sort of depth of insight.
With S/D we look for areas of strong price movement which usually react in the same direction when price revisits
Thanks for the reply, I'm definitely going to explore this more. Look forward to more of your posts.