MACD indicator is used to identify trends, potential reversals and momentum in a given asset.
MACD consists of three main parts:
- The MACD line
- The Signal line
- The Histograms
Sep 28 โข 6 tweets โข 4 min read
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1.*Supply Zone (๐)*
A supply zone is a price area where selling pressure is stronger than buying pressure. It usually forms after a sharp move downward, showing where big sellers (institutions, smart money, or large traders) entered the market.
๐น When price revisits this zone, sellers often re-enter with fresh orders.
๐น The excess supply creates resistance, making it hard for price to break higher.
๐น As a result, price may slow down, consolidate, or reverse downward from this area.
*Key Characteristics of a Supply Zone* :
Found near previous swing highs or after strong bearish moves.
Formed by clusters of sell orders left behind by institutions.
Acts like a โresistance wallโ where price struggles to advance.