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I find it useful to look at the big picture from time to time. In technical analysis terms, that usually means inspection of weekly and/or monthly charts. However, I rarely get to see analysis of "ultra-high" timeframe charts, so I decided to make a couple of attempts of my own. Previously, I analysed long term charts of the Euro and the Yen.
Today I'll have a look at yearly and quarterly Cable charts, covering the period from 1971 to 2015. While the yearly may be good for a quick overview of the price action, the quarterly chart offers more detail and makes trends, ranges and patterns more easily observable. I will be focusing on the latter for my analysis.
Yearly Chart
Quarterly Chart
The Character of the Pair
The thing that I find the most fascinating on this long term chart is that it pretty much captures the character of the pair that is known to me from trading it on lower timeframes. Long lasting trends with deep retracements; sharp rallies and sell-offs; extended ranges; and plenty of fake breakouts. Were time and price scales removed, I might not have been able to tell that it's not a daily (D1), not an intraday (H1) and not a London session price action (M5)…
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al_dcdemo avatar
al_dcdemo 31 Oct.

Kivetat I'm of the same opinion!

foreignexchange avatar

great article

KATRIN_90 avatar

ты молодец! хорошая статья)

VictoriaVika avatar

al_dcdemo , its insightful - very well done! A brilliant article. Inspiring! Many useful information, informative and helpful, also there are some useful tools introduced, thanks, Vika.

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This article is written with the intent to explain basic supply and demand economics and how retail forex traders could benefit from this knowledge. Most retail forex traders are not finance geek and have limited knowledge about market dynamics and how forex market operates. Early Trading YearsI entered the world of forex trading about four years ago and I came from a Management background. When I started trading, I did not have any clue whatsoever about forex market. I used to visit different trading forums and financial news websites in search of a profitable system, where I saw different explanation of price movements. Some financial news website would say that the reason US Dollar fell against Euro because it reached a 50% fibonacci retracement, whereas another forum would state that the price fell because it hit 100 day moving average, other financial experts would argue that prices fell cause it touched a descending trend line and a bunch of experts would say that price fell cause it reached a resistance level. As a novice trader, I used to scratch my head because all these different explanations were too much for me to grasp and it was hard to keep up with it. As a result, I…
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Nicco avatar
Nicco 30 Sep.

I agree with your statements, I have used sometimes this analyse, but the Forex market is a delocalised one and VSA is rigourously suitable for trading stocks.

doubeltop avatar
doubeltop 26 Jan.

Supply and demand zones is an elementary perspective. It's great to see people that truly understand the concept and can use it. It's also nice have indicators now that identify these levels for you on the chart.

pjameslamar avatar

this article and MaximumLots posted an article: 10 Mar Supply and Demand Trading: Choosing the Right Level really compliment each other. Excellent work guys and thanks.

ABCtrader avatar
ABCtrader 21 Dec.

HI all ,thanks Alifari for this Articles ,you know I am attending a course coasting me 2000 u$ to learn how to trade in right way and the most interesting things they teach us now about supply and demands and how to recognize it from the chart and its applied for all markets not only for forex and really it worth to learn how, also I study marketprofile do you believe that those supply and demand are really appears on the chart without any search you can find it in POC.(Point of control).
thanks for the post again.

Gary avatar
Gary 2 July

Great article Alifari! Is the comment on your E/U 30m min chart a typo??? You state Entering at the top of a zone to buy & entering at the bottom of a zone to sell?? Or am I misreading it?

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     With the development of the Bretton Woods monetary system and the
transition to Jamaica established a model of a free currency conversion
that gave rise to equilibrium in the foreign exchange market. Its main
feature was the shift to a regime of floating exchange rates. Now, not
so much a state as the market itself determines the value of a currency.
If things go well for the country, the economy is booming, the demand
for domestic currency increases, including increased volume of
transactions in this currency. If on the contrary, the state is
experiencing economic difficulties, its national currency losing value.
This is the balance in the foreign exchange market. It is also
remarkable that such a situation is characteristic only for those
currencies whose rates are completely free floating.    
With the advent of the Internet and the establishment of electronic
trading in the forex market balance was only worsen because rates are
much quicker to react to events and changes, and accordingly, the rate
of arrival rate to the market value of the currency should only grow.
But there was a bias in the opposite direction, exposing the
shortcomings of the Jamaican currency system. …
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Bideira avatar
Bideira 2 Jan.

Nice point of view. Good article and good lucky to the contest

doctortyby avatar

Concerning the evolution of the Financial Markets, I see a great change in the near future... just think of the Risk On correlation for Gold in the last few months. Good luck in the contest. Mult Noroc +!

ritesh avatar
ritesh 3 Jan.

Uncertainty these days helps HFT make fortunes +1

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