Your Opinion on the Forex
Please share your opinion.
Why does any currency pair, stop and turn at particular points? (see highlighted photo of EURUSD, 1 hour chart)
Please be as detailed as possible. And please, if you want, share your opinion about why stocks, futures, commodities, etc. stop and turn where they do.
Hi Zion_Lion,
The financial asset stop and turn at particular points because this points is not a desired area/price (black figure) to trade by market participants.
Market participants is all the Market, from retail trades to hedge funds, so, when we have a directional idea for any currencie, stock or index, we trade in the most traded price and the target is another most traded price from past days, but, for the price arrive to this new point, the price have to break this "not desired area".
The image is the eurusd on the monthly most traded price
It is because there are certain demand and supply areas called supports and resistances in a currency pair. So the price pull back when it reaches that support and resistance level. If it don't pullback and breaks a support level (or a resistance) then the price go down very quickly to the next support (resistance) level and a resistance (or a support) is created in place of broken support(resistance) level.
just to share a link for Market profile from CME Group that show how this point was done:
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
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Please share your opinion.
Why does any currency pair, stop and turn at particular points? (see highlighted photo of EURUSD, 1 hour chart)
Please be as detailed as possible. And please, if you want, share your opinion about why stocks, futures, commodities, etc. stop and turn where they do.