WEBVTT

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Now we are getting used to think in terms of supply and demand,

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it won't be hard to read the chart and tell what is happening in any single phase.

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Here we have dollar Japanese yen on a daily chart.

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I have coloured in pink the periods when the market is moving down and in green the periods when the market

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is moving up.

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So you can see that we have a first part on the left where the price goes down and there are strong

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red candles. Then we meet the first bullish period that you can see in green.

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One thing you can notice is that every time that sellers step in the market, buyers' reaction is always

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stronger.

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Look at the few red candles during this period and look at the green candles that follow.

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It's easy to see that buyers are completely in control. At one point, the price becomes very attractive

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for sellers and you can see this from the first candles of the new bearish period that pushed the price

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down of almost 400 pips. After one month,

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the demand for the currency pair starts to increase and we see the price going up again. Once again, you

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can notice that the moves made by the sellers are very weak compared to the moves made by the buyers.

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So how can I say this?

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Take a look at the candles.

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More specifically take a look at the bodies of the candles.

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When sellers try to take control, they and the session with a few pips below the opening,

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so you see very small real bodies. When buyers take control,

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the session ends with 50, 60, 70 or even more pips above the opening.

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So buyers are making stronger moves during this period.

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At the end of the chart we have another zone where supply seems to be higher than the demand and sellers

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are in control.

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The price is going down and there's no trace of buyers at the moment.

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Now you can think: "well, everything seems to be reasonable,

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but how can we know when buyers or sellers lose control of the market

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and there's a change in the scenario?"

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Or to put it in simple terms, how can we know when the trend is changing and when it is confirmed?

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Starting from now, till the end of the course,

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we are going to try to answer this question,

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studying the behavior of the key players on the market through the study of the candlestick patterns.