Supply and Demand 

More often you will be looking at charts, more often you are going to see “zones”, which the price has struggles to cross or even change the trend there.

If we look at the CAD/JPY chart below, we can see how the price stopped in the green area and strongly bounced to the upside. This means that the price found demand zone, which means that there was more buyers than sellers, so they won the fight. If there is such a strong bounce like this and price comes there again in the close future, we can expect similar behaviour because of pending orders of buyers. When the price tries to break the demand zone unsuccessfully for more times, usually we can see a trend reversal, so buyers push the price above the upper sideways zone.


This next example we can see how sellers were struggling with the demand zone but finally were able to cross. Most likely there were almost no buyers left when the price came back to test the “already crossed demand zone” and another sellers had their pending orders filled.