Have you ever noticed how stock prices often reverse at certain levels? These levels are called demand and supply zones, and they are the backbone of price movements in the stock market. At [Your Institute Name], we teach you how to identify and trade these zones in our Best Stock Market Classes in Jaipur. Let’s break it down with examples.
What Are Demand and Supply Zones?
- Demand Zone: A price level where buying pressure is strong enough to push the price up.
- Supply Zone: A price level where selling pressure is strong enough to push the price down.
These zones are created by institutional activity and are key to understanding market movements.
Example: Demand and Supply in Action
Let’s take the example of Infosys:
- Demand Zone:
- Suppose Infosys is trading at ₹1,500, and the price starts falling. At ₹1,400, big institutions start buying heavily, creating a demand zone.
- Retail traders see the price bouncing back from ₹1,400 and start buying too, further increasing demand.
- The price rises from ₹1,400 to ₹1,600, and ₹1,400 becomes a strong demand zone.
- Supply Zone:
- Now, Infosys reaches ₹1,600, and institutions start selling their shares, creating a supply zone.
- Retail traders see the price falling from ₹1,600 and start selling too, further increasing supply.
- The price falls from ₹1,600 to ₹1,400, and ₹1,600 becomes a strong supply zone.
How to Identify Demand and Supply Zones
At [Your Institute Name], we teach you how to spot these zones using:
- Price Action:
Look for areas where the price has reversed multiple times. These are likely demand or supply zones. - Volume Analysis:
High trading volumes at a specific price level indicate institutional activity and the creation of a zone. - Candlestick Patterns:
Reversal patterns like engulfing candles or pin bars often form at demand and supply zones.
Why Learn Demand and Supply Trading?
Trading based on demand and supply zones helps you:
- Enter trades at the best possible prices.
- Avoid chasing the market.
- Trade like institutions.
In our Best Stock Market Classes in Jaipur, we teach you these strategies step-by-step.
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