Hey guys, I have been going through this No Nonsense Forex videos and have come across the theory where supply and demand actually have no say in the market in forex. Like maybe demand does but supply has no real say in prices, which makes all these overbought and oversold theories null in forex markets but useful in other markets like stocks and the rest.
What do you think of this? I kind of agree with the guy l, but I’m still not very clear on it.
I have never concerned myself with supply and demand in trading forex, only price. Price is the only data we can see. Data we cannot see is inherently excluded from being trusted.
I really like this point of view, but don’t you think it still affects the techniques we use now like SR levels and Trendlines and indicators such as Stochastic oscillator?
Because these concepts were brought into the forex market from other markets where supply and demand really has effects like the commodities markets and stocks
For example since the prices are determined by the market makers in forex unlike other markets, there really is no supply factor, and hence pairs are never overbought or oversold. I personally don’t use these overbought or oversold signals I only use stochastic to spot divergences but still if stochastics was made for the stock market and wasn’t tuned to the forex market how then am I to rely on it
All indicators etc are made up from the price , so price ultimately is the main indicator as will always be current.
To many try to over complicate and use fancy lingo and theories to either sell a course or make an excuse for losing, when nobody knows what the price will be in the next day or so. All we can do is look at the chart for clues and make a best guess coupled with good money management. Dont try to look for a holy grail and keep simple
No, prices are the only data that indicators can use because they can’t see the actual volumes of currency traded in the foreign exchange market. Indicators can’t mathematically use data they are not provided with.
If price repeatedly respects a certain level it is valid to call this potential support or resistance. You can infer that it is trading volumes around these levels that cause price to reside there or rebound there. But you can’t confirm this hypothesis so how does it help?
But then how do you spot entries on price alone without using support resistance zones that have been made up from demand and supply theory?
But support and resistance were created from demand and supply no?
Yes indeed, but you can only see price support and resistance on a price chart. The supply and demand are invisible and unmeasurable.
By watching the candles form and understanding the make up of the candle at key levels defined by prior history
So if support and resistance theories are drawn from demand and supply and there’s no real supply factor in the forex market then this means they are misleading for forex trading right?
No not in the slightest , its just a market like any other. The markets pay me very well each day and I never concern myself with over complicating the process. I trade what I see
But the markets are unique to each other aren’t they? And to really get ahead you need to understand their uniqueness and construct a strategy for each.
Nope , all have different movements in speed ad range but follow the same rules. At the end of the day a market can only go 3 ways up down sideways
It’s not just in speed or range from what I’ve gathered, I can see in this forex game it’s you vs the people that move the market and you need to know the reason why the market is moving and try as much as possible to follow that direction or rather use that information to create an edge for yourself in the market no?
What do I know lol , over complicating things
I also observe Support and Demand. But, I find it too difficult to define Support and Demand, but if it is well defined, it doesn’t mean that markets will go in the right direction. Just take a look at the default indicator which looks simpler
No, supply and demand are not misleading, they do push prices up or down according to which is the more powerful. But we can’t see the supply and demand, only its traces in the form of price moving. But since we’re trading price movement not volume movement, that’s fine.
Please which indicator do you speak of as the default?