No Mention of Supply and Demand in Trading?

[jonbig04]

At least not very much....

There is a price action journal which is great, I love it. But it seems strange to me that no one tries to read supply and demand. Price action is not the end all, supply and demand is. Price action is, yes, derivative of supply and demand.

I understand of course price action and indicators and everything else have their place and there are a million ways to skin a cat..it just seems a little peculiar to me that no one ever mentions or talks about trying to interpret supply and demand in trading.

 

[dandxg]

Are you kidding? That's what trading with price and volume is all about. Supply and demand. Trying do a search on price and volume. Hint Wyckoff, VSA, Market Profile.

 

[jonbig04]

Quote from dandxg:

Are you kidding? That's what trading with price and volume is all about.

Right and it's what I am trying to do, but like I said Wyckoff etc supply and demand arent mentioned very much on ET. Its more about price action (S/R) and other indicators.

 

[bespoke]

what does supply and demand have to do with trading? its all about stochs and macd

 

[The Swordsman]

Jon, get off ET and watch charts live everyday. You'll get all the lessons of supply and demand (via p/v) than you'll ever get here.

 

[jonbig04]

Quote from bespoke:

what does supply and demand have to do with trading?

EDIT: Wait, you we're joking right? Just making sure.

 

[jonbig04]

Quote from The Swordsman:

Jon, get off ET and watch charts live everyday. You'll get all the lessons of supply and demand (via p/v) than you'll ever get here.

I do bro. My damn eyeballs hurt. When I close my eyes I see candles and vol bars. haha I'm not looking to learn anything necessarily, it just seems strange that its such an untouched subject around here for the most part.

 

[dandxg]

Quote from jonbig04:

Right and it's what I am trying to do, but like I said Wyckoff etc supply and demand arent mentioned very much on ET. Its more about price action (S/R) and other indicators.

ET is really a looking glass of the avg. trading mentality. Give me the grail! How much does it cost? Can I charge it! Where's that Wize Trade seminar?

 

[jonbig04]

Quote from dandxg:

ET is really a looking glass of the avg. trading mentality. Give me the grail! How much does it cost? Can I charge it! Where's that Wize Trade seminar?

Point Taken.

 

[womblevader]

Supply and demand is a hard one for stocks as it doesn't follow normal supply and demand curves.

Usually as the price goods and services decrease demand will increase.

However as the price of a stock decline demand will often decrease.

This is because the price of the stock reflects all the future cashflow's [risk adjusted etc]. As the future is uncertain no-one really knows what the cash flows will be. Or for that matter what the exact risk will be. NB V is always a backward looking indicator.

So even using a gauge model with both risk and cash flows being uncertain you can have the situation where risk is reduced [ie more certainty] with lower cash flows and sometimes see the price go up.

Cheers