Identifying momentum and structure in Supply and Demand.
Identifying momentum and structure in Supply and Demand.
Recognizing momentum and structure is very important to be able to trade correctly.
In this blog I will tell you more about this and I also made a video about it, watch it after reading the blog.
We start with determining the highs and the lows.
In the example below you can see how I determine and draw this.
Identifying momentum and structure in Supply and Demand.
You can clearly see the High and the Low here.
This way you can immediately see the range in which the price is currently moving.
The price zone at the top of the image also shows a very important Supply level.
It is a critical level that you should always keep an eye on, often we see at these levels that it can be a very good turning point in the price.
And we can clearly see that in this image the price reaches the Supply zone, breaks through it slightly and then falls all the way back (Sellers Pressure).
Many Sell orders have been placed in this level.
That explains why the price was pushed up slightly at the zone and then fell completely.
Identifying momentum and structure in Supply and Demand.
Demand zone
You see the Demand zone in the image above and we can also see that price has already responded to it twice before and the price went up again from the Demand zone.
Here we could have already taken a nice buy from the Demand level twice.
Then the price returns for the third time in the Demand zone, we also see a clear rejection in the Demand zone and the price shoots up (Buyers pressure) all the way to the Supply zone above.
We also see very well the structure of the price here, we can clearly see here that the price was making Higher Lows and Higher Highs.
Just take a look at the image below.
Identifying momentum and structure in Supply and Demand.
In this image we clearly see the structure that slowly moves upwards from the demand level.
And in this range we can also see multiple levels that we can trade from.
The most important thing is that you learn to recognize these Lows and Highs and that you can find them back the charts.
And of course it is also very important to also use the Supply and Demand zones where the price often makes this critical reversal in combination with the price structure.
In the video that I share with you below, I explained everything again. Watch this video and take in all the information.
Of course it is also important that you continue to study the charts and continue to practice to learn to recognize the Structure and Momentum.
Identifying momentum and structure in Supply and Demand.
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