Here the color scheme was changed to represent our favorite two things in trading: supply/demand.
If you are new to trading or supply/demand methods, You can maybe employ BB's (or any other channels).
Red/supply line: use as reminder not to buy into weakness.
Green/Demand line: use as a reminder not to sell into strength.
More important.. think of the green line as the "accumulation" or demand side
Red as the "distribution" or supply side.
Look at where all the action is. Look at were the candles were before any subsequent impulse. Where do they generally begin from?
taking a look at the BB and BB% do any moves really begin near the median? .. generally no.
this is what is meant buy fishing from the edges and not from the center.
Using the BB% (RSI/MFI will be similar) .. look at the same thing. Look at the extremes or edges and the volume.
When price breaks the demand line, is the volume high? is there active accumulation going on?
- IF the volume is high with each break of the demand line, they are buying and likely looking for a clear mark up path, which can take days.
When price breaks the supply line, is there an increase in volume pushing the price back into range?
-IF the volume is high with each break of the supply line, they are selling and likely looking for a lack of demand which allows for a clear path to mark don... this can also take a few days.
Biggest takeaway from this is the principle of not buying or selling when price is in the middle of a range. When price is in the middle of a trading range or consolidation (some of you know it as consolidation, just another way of saying trading range) the market is IN BALANCE.. there is equilibrium between supply and demand at that moment.
Price will "consolidate" for either a mark-down or a mark-up. When price is behaving in this manner it means that it has not decided which way to go and is waiting for an imbalance... if more supply accumulated then demand... price will fall..if there was more demand than supply.. then price will break to the up side.
PM if confused!
Avoid buying into weakness/supply/resistance
Avoid selling into strength/demand/support
Avoid entry when price is in middle of a range (phase B)
And
Don’t let them win
If you are new to trading or supply/demand methods, You can maybe employ BB's (or any other channels).
Red/supply line: use as reminder not to buy into weakness.
Green/Demand line: use as a reminder not to sell into strength.
More important.. think of the green line as the "accumulation" or demand side
Red as the "distribution" or supply side.
Look at where all the action is. Look at were the candles were before any subsequent impulse. Where do they generally begin from?
taking a look at the BB and BB% do any moves really begin near the median? .. generally no.
this is what is meant buy fishing from the edges and not from the center.
Using the BB% (RSI/MFI will be similar) .. look at the same thing. Look at the extremes or edges and the volume.
When price breaks the demand line, is the volume high? is there active accumulation going on?
- IF the volume is high with each break of the demand line, they are buying and likely looking for a clear mark up path, which can take days.
When price breaks the supply line, is there an increase in volume pushing the price back into range?
-IF the volume is high with each break of the supply line, they are selling and likely looking for a lack of demand which allows for a clear path to mark don... this can also take a few days.
Biggest takeaway from this is the principle of not buying or selling when price is in the middle of a range. When price is in the middle of a trading range or consolidation (some of you know it as consolidation, just another way of saying trading range) the market is IN BALANCE.. there is equilibrium between supply and demand at that moment.
Price will "consolidate" for either a mark-down or a mark-up. When price is behaving in this manner it means that it has not decided which way to go and is waiting for an imbalance... if more supply accumulated then demand... price will fall..if there was more demand than supply.. then price will break to the up side.
PM if confused!
Avoid buying into weakness/supply/resistance
Avoid selling into strength/demand/support
Avoid entry when price is in middle of a range (phase B)
And
Don’t let them win