Hi traders! Hope you had an amazing weekend. I usually post ideas where I state trading ranges and the important of them. Therefore, I decided to explain it briefly below and why they are important - please keep an open mind and feel free to ask me any questions below! - Abdulla
What are Trading Ranges?
One of Richard Wyckoff methods to improve the timing when entering a position in anticipation of a coming move is to find trading ranges. So what are trading ranges? They are places where the previous trend (up or down) has been halted and there is a visible equilibrium between supply and demand. When you have a visible equilibrium markets tend to trade sideways. Institutions and other large professional interests prepare for their next bull (or bear) campaign as they accumulate (or distribute) shares within the Trading Range. In both accumulation and distribution (or re-accumulation/re-distribution) Trading Ranges, the Composite Man (or the market makers) is actively buying and selling, the distinction being that in accumulation, the shares purchased outnumber those sold, while in distribution the opposite is true.
How can the supply be greater than the demand ? Obviously it was bought so it was demanded how’s that work?
abdullatrader
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@JpTraded, @JpTraded, When prices goes lower, that means the supply is greater than demand and vice-versa. However, if the supply and demand is close to equal - you will see prices trading sideways until one force (supply or demand) is greater than the other.
mcmco421
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@JpTraded, Demand is measured by the actual number of trades made (which is what I think you are referring to in your question), however it is also measured by willingness to buy and sell at a specific price. So when he says "Demand is greater than Supply" after accumulation, I think he is referring to the idea that the Demand of people willing to pay a higher price is increased. The opposite is true after distribution, where the willingness to accept a lower price is increased. Hope this helps. Confused me at first as well. Cheers.
Cryptorphic
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You are good in Charting. Keep up the good work.
What do you think of BITCOIN's next Resistance? Can you chart your Idea on this one?
Julysma
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Thank you for taking the time to share your knowledge on specific segments of TA.
For me it's like learning a new language and even if I don't become fluent, I'd love at least to understand it.
"Patience is always rewarded" ;-)
abdullatrader
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@Julysma, I agree, and always keep in mind that you'll always learn in this journey. Guess what? after more than 5 years in this industry, I still take the time to read books that might help me improve. Don't become like the ones who think they have mastered the markets in x-years. There will always be something new to learn. Goodluck!
CodyJournell
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@AAlFadhala, Do you have any specific books you'd recommend to someone who just started learning TA?