Supply and Demand Trading: A Forex Trader’s Guide

Supply and demand are key determinants of price. Knowing how to identify supply and demand zones can assist in identifying future price movements

If you haven’t learned the basics of the supply and demand, or would like a refresher, read our guide on the1) Use longer time frames to identify supply and demand zones

By zooming out, traders are able to get a better view of areas where price had bounced off previously. Be sure to use the appropriate charts when altering the between. Draw a rectangular shape to denote this zone. Demand and supply zones do not necessarily have to appear together - often currency pairs can reveal one or the other.. Once institutional traders and big banks see this value, they will look to capitalize on it.

above the supply zone and targets at the demand zone. Conservative traders can set the target above the demand zone or implement a number of otherSupply and demand zones are created by the interaction of the individual concepts of ‘supply’ and ‘demand’. Learn about theLeveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors.

We recommend that you seek independent advice and ensure you fully understand the risks involved before trading. Information presented by DailyFX Limited should be construed as market commentary, merely observing economical, political and market conditions. This information is made available for informational purposes only. It is not a solicitation or a recommendation to trade derivatives contracts or securities and should not be construed or interpreted as financial advice.

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