"Supply / Demand Zones"

The concepts of supply and demand zones are undoubtedly two of the most highly discussed attributes of technical analysis. Part of analysing chart of pattern, these terms are used by traders to refer to price levels in charts that tend to act as barriers, preventing the price of an asset from getting pushed in a certain direction. At first, the explanation and idea behind identifying these levels seems easy, but as you'll find out, supply and demand zones can come in various forms, and the concept is more difficult to master than it first appears.

Demand zonesis a price level where a downtrend can be expected to pause due to a concentration of demand. As the price of a currency drops, demand for the currency increases, thus forming the support zone. Meanwhile, supply zones arise due to sell off when prices increase.

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