Supply & Demand (For Dummies)


foreigner

Est. 12480 Hours and Counting
Heres a question for all you supply and demand geniuses out there;

If supply makes price go down and demand makes price go up, why does price go down when the market makers are short the currency? conversely, why does price go up when they are long or are supplying the currency?

My next question to the supply and demand crowd is if supply is an area on a chart where price moved up from and demand an area on a chart where price declined from why do the market makers run stops beyond those levels?

Are you saying that stop hunting and liquidity pools dont exist? I suppose price just slipped past your supply level by accident?

My last question is if supply and demand does exist in speculation, why is it promoted so readily on mainstream websites like FX Street? I suppose the market makers (who sponsor the site) are ok with you knowing their most guarded secret "supply and demand"?
 

the golden gun

RINSE & REPEAT
foreigner said:
Heres a question for all you supply and demand geniuses out there;

If supply makes price go down and demand makes price go up, why does price go down when the market makers are short the currency? conversely, why does price go up when they are long or are supplying the currency?

My next question to the supply and demand crowd is if supply is an area on a chart where price moved up from and demand an area on a chart where price declined from why do the market makers run stops beyond those levels?

Are you saying that stop hunting and liquidity pools dont exist? I suppose price just slipped past your supply level by accident?

My last question is if supply and demand does exist in speculation, why is it promoted so readily on mainstream websites like FX Street? I suppose the market makers (who sponsor the site) are ok with you knowing their most guarded secret "supply and demand"?
Actually, market makers do operate on supply & demand principles...

supply of suckers and demand for deposits :))
 

foreigner

Est. 12480 Hours and Counting
the golden gun said:
Actually, market makers do operate on supply & demand principles...

supply of suckers and demand for deposits :))
Ironically that is the case.
 

foreigner

Est. 12480 Hours and Counting
Re: Supply & Demand Food For Thought

As anyone that understands Accumulation Distribution will tell you, what actually happens in reality is the polar opposite to supply and demand.

When being accumulated, the currency is in demand therefore suppliers will drive price lower sucking in those thinking its in supply and visa versa, if a currency is being distributed price is typically driven up to sell at the highest price possible, nothing to do with demand quite the opposite.

This is also accentuated by the fact that a currency pair can be driven up or down by either currency. As far as Im aware It does not depend on the pair being traded together, unlike a futures contract that does require a change of hands.

This is how the Forex Puppeteers run circles around us. This is crucial in understanding that what you see in a Forex pair is neither supply or demand but rather a relative imbalance(correction Inefficiency) that cannot be quantified either as there is no central record of volume.

Why is there no true volume measured? because they dont want you to know whos really in control of the market ;)

The best we can tell from a chart is whether a currency is likely being accumulated or distributed and attempt to align our orders with the market makers order flow. Supply and demand is just another grad school square peg shoved in to a round hole.
 

rod178

Well-Known Member
Price changes direction to a large move up when a large entity(s) stops selling. They may then recommence selling when price reaches a higher level into a liquidity pool large enough to absorb their new sell orders.

Price changes direction to a large move down down when a large entity(s) stops buying. They may then recommence buying when price reaches a lower level into a liquidity pool large enough to absorb their new buy orders.

The concept that large entities will 'burn' funds to move price by 'significant' buying and selling is merely another Retail Trader delusion. Additionally, there is no 'true' volume because there is no central exchange,
 

foreigner

Est. 12480 Hours and Counting
Re: Supply & Demand

Thanks for your reply Rod.

rod178 said:
Price changes direction to a large move up when a large entity(s) stops selling.
Not as far as I'm aware. Price moves up when commercials start selling. Its known as the market maker profit release phase.

rod178 said:
They may then recommence selling when price reaches a higher level into a liquidity pool large enough to absorb their new sell orders.
Yes that fits the profit release model.

rod178 said:
The concept that large entities will 'burn' funds to move price by 'significant' buying and selling is merely another Retail Trader delusion.
The commercials may not be burning funds, agreed, however the breaker block principle shows they will send price in the "wrong" direction to fulfill their requirements.
 

rod178

Well-Known Member
Re: Supply & Demand

foreigner said:
Not as far as I'm aware. Price moves up when commercials start selling. Its known as the market maker profit release phase.
The 'commercials start selling' cannot be the reason that prices then rise. They are selling into already rising prices and the consequent increase in liquidity, which is the result others 'piling in' to buy (triggered stops and breakouts) after the prices have already risen, which has been the result of the large entity(s) halt in selling.
 

Golden Bull

We got cookies
Re: Supply & Demand

foreigner said:
Not as far as I'm aware. Price moves up when commercials start selling. Its known as the market maker profit release phase.
You probably trying to heat your tea in the freezer by that logic... :lawl: I think if you find a dumbass trader quote of the year competition, you should name this in.. :D

You are a funny dude, nobody listens to your bickering , so you decided to review this thing...? :D

-P
 

Peterma

Well-Known Member
I can understand what foreigner is trying to say.

I am a small time commercial, I currently buy Eur and sell Gbp, each time Eur falls and Gbp rises I will continue to do so.

If I was big enough and was able to cause Euro to fall I would do so in order that I could buy some more, if I could cause Gbp to rise I would do so in order to sell some more of them - sadly I will just have to wait for bigger guys/gals.
 

rod178

Well-Known Member
Peterma said:
I can understand what foreigner is trying to say...
"Price moves up when commercials start selling" Nope!!

Their selling cannot be the reason that prices move up.

Bottom line is that large entities (mostly Banks, although Commercials obviously use Banks to fulfil their orders) can only have their large orders fulfilled into significant pools of liquidity. The Banks are privy to the Order Books so let price trade into the liquidity pools (OBs or stop pools etc) before fulfilling their own and large client orders.

There is no need to buy to artificially force price up, it is the exception rather than the rule. Banks are continuously buying and selling (say 50:50). It is a simple matter to restrict selling and maintain buying (say sell 20:80 buy) to drive price up from areas of relatively low liquidity into a liquidity pool before initiating heavy selling (say 80:20). Their sell orders are absorbed (now back to 50:50) at a good price before other Traders jump in and prices falls significantly. It's then rinse and repeat.
 

Peterma

Well-Known Member
rod178 said:
Their selling cannot be the reason that prices move up.
Commercial selling is most def a consequence of move up, commercials are not selling something not already in stock (speculating) they are selling stock (money) already purchased at a cheaper level, as it's value increases so good business to sell that stock at profit.

Also good business to create the conditions to accelerate the profit. If commercials (say a banking entity) was able to apply some degree of influence to increase the net worth of a portion of stock before selling it will do so.

So is the subsequent selling by the commercial the reason for that increase or is their selling merely the consequence of the price increase?
 

garry

the art of war
foreigner said:
Heres a question for all you supply and demand geniuses out there;

If supply makes price go down and demand makes price go up, why does price go down when the market makers are short the currency? conversely, why does price go up when they are long or are supplying the currency?

My next question to the supply and demand crowd is if supply is an area on a chart where price moved up from and demand an area on a chart where price declined from why do the market makers run stops beyond those levels?

Are you saying that stop hunting and liquidity pools dont exist? I suppose price just slipped past your supply level by accident?

My last question is if supply and demand does exist in speculation, why is it promoted so readily on mainstream websites like FX Street? I suppose the market makers (who sponsor the site) are ok with you knowing their most guarded secret "supply and demand"?
s/d is just a label u could call it stop hunting flow trading as you have a retail mindset your thinking is flawed ,thats why 95% of you are losers or b/e at most traders.
all the ict marketmarker stuff has been out there years ive seen it all in mainstream .he does produce it very well and if you are new or not making profit .
i would say its a best place to start ,study and implement ,you should not worry what the s/d crowd trade ,the hours you waste posting dribble would be better spent pushing buy/and sell and watching your p/l and expectancy
 

garry

the art of war
Peterma said:
Commercial selling is most def a consequence of move up, commercials are not selling something not already in stock (speculating) they are selling stock (money) already purchased at a cheaper level, as it's value increases so good business to sell that stock at profit.

Also good business to create the conditions to accelerate the profit. If commercials (say a banking entity) was able to apply some degree of influence to increase the net worth of a portion of stock before selling it will do so.

So is the subsequent selling by the commercial the reason for that increase or is their selling merely the consequence of the price increase?
go knock yourself out with this
http://people.stern.nyu.edu/lpederse/papers/predatory_trading.pdf
 

Golden Bull

We got cookies
garry said:
s/d is just a label u could call it stop hunting flow trading as you have a retail mindset your thinking is flawed ,thats why 95% of you are losers or b/e at most traders.
all the ict marketmarker stuff has been out there years ive seen it all in mainstream .he does produce it very well and if you are new or not making profit .
i would say its a best place to start ,study and implement ,you should not worry what the s/d crowd trade ,the hours you waste posting dribble would be better spent pushing buy/and sell and watching your p/l and expectancy
:hail: :hail: :hail: :hail:

Fuckin' A+!

P
 

foreigner

Est. 12480 Hours and Counting
Re: Supply & Demand

rod178 said:
The 'commercials start selling' cannot be the reason that prices then rise.
Ok, Why not?! Peterma summed it up, its absolutely the reason prices rise.

rod178 said:
They are selling into already rising prices and the consequent increase in liquidity, which is the result others 'piling in' to buy (triggered stops and breakouts).
Do you mean consequent increase in volume? because its a sharp decrease in liquidity that causes price to move up, or down, according to Chris Lori.

rod178 said:
after the prices have already risen, which has been the result of the large entity(s) halt in selling
Sorry Rod that makes no sense, large entities sell in to rising markets, when they stop selling prices decline. Why does the supply demand crowd seem to ignore is the fact that someone has to MAKE the market? which means doing the opposite to the majority of market participants.

This is the basis for the optimal trade entry as I understand it and the reason we should never chase price regardless of where we think its going.

Piper 2.0 said:
You probably trying to heat your tea in the freezer by that logic... :lawl: I think if you find a dumbass trader quote of the year competition, you should name this in.. :D

You are a funny dude, nobody listens to your bickering , so you decided to review this thing...? :D

-P
I enjoy a rant, true.I haven't heard any compelling arguments from you though, too busy chomping on your nans's cookies, theyll turn your brain to mush you know!
 

rod178

Well-Known Member
You are confusing Accumulation and Distribution with price manipulation into pools of liquidity
Additionally confusing cause with effect.
 

TopFroxx

Well-Known Member
from an "outsiders" perspective: my advice is to listen to everybody (especially rod), you got so much mixed up
 

foreigner

Est. 12480 Hours and Counting
Re: Supply & Demand

rod178 said:
You are confusing Accumulation and Distribution with price manipulation into pools of liquidity
As far as Im aware theyre the same thing, again please correct me if Im wrong?

rod178 said:
Additionally confusing cause with effect.
Cause and effect helps clarify part of your statement, however, I dont see how that makes me confused? besides, Im trying to determine a relationship between the Forex Market and Supply and Demand, however as of yet Ive not heard a single argument for supply and demand. If Im missing something youve already said, maybe you could spell it out for me?
 

garry

the art of war
Re: Supply & Demand

foreigner said:
As far as Im aware theyre the same thing, again please correct me if Im wrong?

Cause and effect helps clarify part of your statement, however, I dont see how that makes me confused? besides, Im trying to determine a relationship between the Forex Market and Supply and Demand, however as of yet Ive not heard a single argument for supply and demand. If Im missing something youve already said, maybe you could spell it out for me?
move along and give up trading you cannot even grasp the basics. wtf back to order blocks and fibs for you my boy
 

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