Did smart money concept also works in stock market?

Beginner Questions
1

Hello, I am from India and I want to know - did smart money concept also works in stock market ?
I am started learning SMC and I apply this method on different stocks and I see there is no any structures like smc. what you think ? Do I need to learn smc for trading on Indian Stock market or price actions is enough.
Thank You

2

Smart money is something that cannot be seen or counted or proven to exist.

If enough people buy, price goes up and you will see it rising. If more people sell, price will go down and you will see it going down too.

2 Likes
3

SMC is just unnecessarily complicated price action trading. Keep it simple and make money. Good luck!

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4

Interesting discussion about ICT/SMC. It’s not a bashfest on ICT, but shows that traders are using the same and similar concepts across different assets.

https://www.reddit.com/r/Daytrading/comments/14gadeh/i_studied_ictsmart_money_concepts_for_4_months/

Check it out.

5

Smart Money Concept (SMC) works in the stock market, but its effectiveness might vary depending on the stocks and market conditions. Smart money moves security prices substantially with high-volume candles and vice versa.

If spotting SMC structures is difficult, try analyzing price and volume together. A price increase with high volume suggests institutional investors are buying, while the opposite indicates they are selling.

6

Why?

Doesn’t every transaction on an exchange have one buyer and one seller? Who’s buying, when institutional investors are selling, and selling when they’re buying?

7

Yes, every trade involves both a buyer and a seller. However, large trading volumes usually come from institutional investors, which retail traders generally cannot match.

Also, when institutional investors sell, retail traders are often the buyers.

If selling volumes exceed buying volumes over multiple days, it typically indicates that institutions are exiting the stock, while retailers are purchasing.

This often leads to retail investors being stuck with stocks at higher levels when prices eventually fall.

8

Who does match them, then? Maybe other institutions?

How does that happen when they’re not even in the same market?

Large institutions are in the interbank market, but retail forex traders are just betting against counterparty “brokers” and not actually in any market at all.

How can they, if every transaction has one buyer and one seller?

10

  1. Large trading volumes are often matched by other institutions. If they don’t match, security prices can either rise like a rocket or go down (depending on the transaction).

  2. Here I am mainly talking about equity market. Hope this clears your doubts somehow.

  3. If you understand demand and supply, it is very easy to understand. Every transaction involves buyers and sellers. If the demand to buy something is high but the supply to sell is low from the seller, the prices will go up, and vice-versa. The same applies here as well.