When I learned about the 4 groups of market participants years ago, it changed the way I read charts. The best setups or trade opportunities occur when the right groups are active, and the others are absent. Today’s video will break it all down and help you see charting in a new light.
NOTES
4 Groups of Market Participants
Technical Analysis: analyzing the behavior of market participants and the interplay between support & resistance.
We try to identify the path of least resistance (slight edge). And seek low-risk/high-reward payouts.
Buyers, bulls, demand
- Buying to open (new bulls): entering new positions
- Buying to close (old bears): exiting old positions
- Short squeeze
Sellers, bears, supply
- Selling to open (new bears): entering new positions
- Selling to close (old bulls): exiting old positions
The best patterns or times to buy are when the 2 groups of buyers are active and the 2 groups of sellers are absent.
The best patterns or times to sell are when the 2 groups of sellers are active and the 2 groups of buyers are absent.
Book: Trade the Trader
Who is on the other side of the trade?
Failed patterns “from failed moves come fast moves in the other direction.”
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