Supply and demand in a nutshell by Alfonso Moreno

EURUSD strong rally. Demand imbalance on weekly. It is an uptrend. Look at daily or 4 HR chart, possibility to add more long positions on the pullbacks down. Trade safe.

PNC Financial Services Group, Inc. is an American bank holding company and financial services corporation based in Pittsburgh, Pennsylvania. Its banking subsidiary, PNC Bank, operates in 21 states and the District of Columbia with 2,459 branches and 9,051 ATMs.

As explained in Set and Forget’s trading community updates, we expect a strong rally from $104 per share. Price action can tell us a lot of things. It tells us that bullish impulses are stronger than bearish impulses. If we know how to read price action and use it in your technical analysis and stock trading strategy, it will help you find turning points on any price chart and timeframe.


Supply and demand Stocks and Forex trading strategy

eBay shares stock, long term buy opportunity
Look at the monthly timeframe analysis. eBay has a very strong imbalance located around $34 per share where we are expecting the price to dip. When will it drop down there? We don’t know. What we do know is that impulse is the strongest one in years and it could be a great buy price level to buy shares of eBay for long term if the trend analysis is still the same by the time price reaches that level.

Attached Image (click to enlarge)

Supply and demand Stocks and Forex trading strategy

EURUSD strong imbalance demand on a weekly. My opinion only buy.

GBPJPY supply zone at daily. COT reports show non-commercials are majority in sell. So my opinion sell on GBPJPY. Trade safe.

British Pound / Japanese Yen chart has been bullish for a few weeks after a new weekly demand imbalance located around 132.50. Quite a few British pound cross pairs have started to rally behaving similarly to GBPJPY cross pair. GBPUSD is not an exception. Add to this that the Japanese Yen is getting weaker across the board.

GBPJPY Forex cross pair buying opportunities
New weekly demand imbalance has gained control on GBPJPY forex cross pair as expected. GBPJPY has been rallying strongly for more than a month since the imbalance took control.

Supply and demand Stocks and Forex trading strategy

Correction, closed my sell on GBPJPY -$55 small loss. It does look bullish but no positions on this pair so far. EURUSD remains bullish, adding more long positions.

As explained a few months ago, a very strong monthly demand imbalance around $218 per share was created before the COVID-19 virus shattered the markets, Apple Inc (NASDAQ: AAPL) broke all-time highs and records again once highs marked by COVID-19 pandemic were broken. Apple Inc stock seems to be unstoppable, great for stock intraday trading and stock swing trading strategies. You can use this Apple supply and demand analysis to plan trades using other stock trading strategies that use smaller timeframes to enter a trade, even stock trading strategies that use indicators and oscillators.

As supply and demand traders, we do not need to pay attention to the news, fundamentals or any earnings reports. Once a big timeframe imbalance has gained control, earnings do just the opposite and react strongly to those imbalances. Why is it that you see positive earnings and then the underlying stock drops like a rock, or a negative earnings announcement and the stock rallies like a rocket out of control? You are probably missing the fact that there are big imbalances gaining control.

Unless you are doing very short term trading and scalping, you should not worry about fundamentals or earnings announcements.

You can use these imbalances to plan your trades in lower timeframes. Trading is just waiting for the right trigger points and scenarios to present themselves, this game has got a name and it’s called the waiting game. We need to patiently wait for the correct scenarios and setups to happen and wait for the price to pull back or dip into the price levels we want to trade, in our case these price levels are made of supply and demand imbalances.


Supply and demand Stocks trading strategy

Netflix, Inc. is still the number one subscription streaming entertainment service in the world, and it keeps getting better and better in a world that is locked down under the effects of the coronavirus pandemic. More and more subscribers have joined their streaming services and the stock is printing all-time highs over and over.

Netflix (NASDAQ: NFLX) has broken all-time high again and created a new weekly demand imbalance around $474 per share that has gained control as expected.

Netflix price chart analysis
There is definitely a long term long bias for Netflix stock, so only buying shares of Netflix stock around $474 should be allowed, or even bullish options strategies that are neutral to bullish because that’s what the bigger picture supply and demand trend analysis is telling us to do. Hopefully, Netflix stock will move much higher and give us a nice profit. You can use smaller timeframes or even other stock trading strategies to buy shares of Netflix stock.



Supply and demand Stocks trading strategy

As expected and mentioned in previous Dollar Index DXY analysis, we had a strong monthly supply imbalance that took control and a big sell-off was expected. That’s exactly what has happened on Dollar Index DXY. A very similar technical analysis has been done for EURUSD Forex technical analysis and forecasts a few more weeks back, a very strong monthly imbalance gained control on EURUSD last March 2020 around 1.0654 and it has not stopped rallying ever since.

The same type of technical supply and demand analysis can be done for Dollar Index DXY. This sell-off is affecting many US dollar Forex cross pairs since most US dollar currency pairs are highly correlated to the American Dollar. A new strong weekly supply imbalance has been created slightly higher. See DXY weekly timeframe analysis below.

Supply and demand Stocks trading strategy

AUDUSD monthly imbalance demand zone. Looking to add long on lower timeframes like daily or 4hr.

Netflix, Inc. is still the number one subscription streaming entertainment service in the world, and it keeps getting better and better in a world that is locked down under the effects of the coronavirus pandemic. More and more subscribers have joined their streaming services and the stock is printing all-time highs over and over.
Netflix (NASDAQ: NFLX) has broken all-time high again and created a new weekly demand imbalance around $474 per share that has gained control as expected.
Netflix price chart analysis

There is definitely a long term long bias for Netflix stock, so only buying shares of Netflix stock around $474 should be allowed, or even bullish options strategies that are neutral to bullish because that’s what the bigger picture supply and demand trend analysis is telling us to do. Hopefully, Netflix stock will move much higher and give us a nice profit. You can use smaller timeframes or even other stock trading strategies to buy shares of Netflix stock.

Supply and demand Stocks trading strategy

S&P 500 e-mini futures and SPY ETF have broken all-time highs as expected and mentioned for months in previous supply and demand analyses. Nasdaq e-mini futures already broke all-time highs a few weeks ago, the second American index following suit is the S&P500 and the third will probably be the Dow Jones Industrial Average index.

As supply and demand traders technical analysts we can see a new demand imbalance created on the daily timeframe around 3,387 price area. All-time highs have been broken again after the strong correction provoked by COVID-19 pandemic. The old highs have been broken again as expected and called in previous S&P500 e-mini futures and SPY analysis. Both in Set and Forget’s blog, the trading community and my supply and demand YouTube channel.
S&P500 e-mini futures chart analysis

As supply and demand traders there is a long term uptrend and bullish bias. As short term traders and day traders, you can use this supply and demand technical analysis and forecast for 2020 to enter longs in the lower timeframes. You can use other stock and ETF trading strategies to trade SPY and any exchange-traded fund or ETF. There is a brand new imbalance on the daily timeframe around 3,387 price area which could be the next trade setup for S&P500 e-mini futures.

Supply and demand Stocks trading strategy

The COVID-19 pandemic has affected Boeing Stock (BA) quite a bit because the whole world has been locked down and the skies have been almost empty for a few months. Many airlines are suffering the worst year in their history because of the strong sell-off that happened with the effects of the virus. Half the world can’t fly and Boeing orders cannot be delivered on time or they have been cancelled.

Should you buy shares of Boeing stock?
However, as supply and demand traders, we know that after a strong sell-off we should expect a bigger correction. We are expecting Boeing stock to rally much higher which will allow us to buy shares of this stock. This is a stock we are watching closely, a nice candidate for long-term longs and with a lot of margin for profit to reach weekly imbalance much higher around $335 per share.


Supply and demand Stocks trading strategy

Expecting a bearish correction on EURUSD Forex cross pair after such a strong bullish impulse. Strong demand level located much lower where we will be able to think of long positions.

Short positions will be possible on the way down to weekly demand imbalance located around 1.12 price level for those forex traders trading short-term and intraday forex trading strategies. There is a lot of room for EURUSD to keep on dropping. There is nothing to prevent EURUSD from the bearish correction if it continues to make lower lows.


Supply and demand Forex trading strategy

Expecting a bullish correction on Dollar Index DXY after such a strong sell-off. Weekly supply level located much higher where we will be able to think of short positions on the Dollar Index DXY. The EURUSD forex cross pair forecast and analysis is very similar but we are expecting a bearish correction instead. EURUSD and Dollar Index DXY are inversely correlated.

Dollar Index forecast and prediction
Long positions will be possible on the way up to weekly supply imbalance located around 97 price level for those forex traders trading short-term and intraday forex trading strategies. There is a lot of room for the Dollar Index to keep on rallying. There is nothing to prevent the Dollar Index from the bullish correction if it continues to make higher highs.



Supply and demand Forex trading strategy

Following the stock split announcements from Tesla and Apple, Amazon stock is likely to be the next to do so. The split will not affect the technical analysis presented below though. But considering the current price of the Amazon stock, it would seem like at least a 10:1 stock split would be the right way to go.

Although investors know that stock splits don’t add any value on a purely economic basis, they can definitely provide a sort of a psychological lift.

Take a look at Amazon supply and demand technical analysis below. You will see Amazon’s monthly timeframe and a strong demand imbalance located around $2,500 per share. Will Amazon AMZN stock pull back so low? I don’t know, but after such a strong impulse we usually see a much more significant retracement and correction, generally to the origin of the move. It could take a few months for such a correction to happen and Amazon could keep on rallying a bit more for a couple of more months. The forecast provided below for Amazon stock is a long-term, short-term and intraday stock strategies will allow you to trade on the way down.

Should we buy shares of Amazon right now in September 2020? Definitely not. The stock is very costly and we are expecting a bigger correction.


Supply and demand Stocks trading strategy

You may remember from previous weekly newsletters that I talked about the American indexes and related ETFs breaking all-time highs and the bearish correction we are expecting on Nasdaq, QQQ and some IT stocks like Amazon, Apple, Tesla and Microsoft.

The video attached below goes over some of the last basic supply and demand analysis that have been published on my YouTube channel. Many traders will get very excited to see that Nasdaq e-mini and #QQQ ETF are breaking all-time highs. I am pretty sure that many traders are long on these indexes and on many IT stocks. Why are these traders opening new bullish positions on IT stocks? Well, they see that all-time highs are being broken on Microsoft #MSFT, Apple #AAPL, Tesla #TSLA, Amazon #AMZN and many other IT stocks.

However, they are missing a critical point. Those stocks are VERY expensive. Not only that, they are also ignoring the forces of supply and demand, which ultimately move the markets.

Waiting and patience are critical to trading Forex and Stocks successfully. Below you will see a couple of examples of what we are expecting to happen on Nasdaq index, Amazon #AMZN, Apple #APP, USDCAD and EURNOK. Will it happen as expected? I don’t know. Just take a look at my Supply and Demand YouTube channel and see some of the basic video analyses that I’ve shared in the past for EURUSD, EURNOK, APPLE, MICROSOFT, TESLA and so many others. These trades were called months before the price reached the price levels. There are no tricks, the videos speak by themselves.


Supply and demand Stocks trading strategy

Advanced Micro Devices, Inc. operates as a semiconductor company worldwide. The company operates in two segments, Computing and Graphics.

We have been watching AMD stock very closely lately after it broke all-time highs a few weeks ago. As supply and demand traders, we must ignore the fundamental stock analysis and focus on what really matters, the type and strength of the new imbalances created in a clear trending market. That’s what AMD has been doing for quite a few months now.

Advanced Micro Devices AMD buy opportunity
Take a look at the monthly timeframe analysis attached below. There is a very strong imbalance that has been created around the $59 price level. We expect AMD stock to keep on dropping attracted by the strength of that impulse. That will allow shorter-term traders to sell shares of AMD in smaller timeframes or even using other stock trading strategies different from the supply and demand stock strategy.

The monthly imbalances around $59 per share seen below is a much longer-term potential purchase, it could take some time for AMD stock to pullback down there, and it might return with a different trend. We’ll be watching this one closely and set our alerts.



Supply and demand Stocks trading strategy

As explained and forecasted for weeks, EURUSD is dropping as expected. We are expecting a bearish correction on EURUSD Forex cross pair after such a strong bullish impulse on the monthly timeframe. There is a monthly demand imbalance located much lower where we will be able to think of long -term positions.

EURUSD forex forecast and prediction 2020
Short positions will be possible on the way down to the monthly imbalance located around 1.10 price level for those forex traders trading short-term, intraday and day trading forex trading strategies. There is a lot of room for EURUSD to keep on dropping. There is nothing to prevent EURUSD from the bearish correction if it continues to make lower lows.

Supply and demand forex trading strategy

As discussed in previous Dollar Index DXY supply and demand analysis and forecast, the expected bullish correction is happening. . The EURUSD forex cross pair forecast and analysis is very similar but we are expecting a bearish correction instead. As a Forex trader, you should know that EURUSD and Dollar Index DXY are inversely correlated and you should avoid trading both assets at the same time as you’d be doubling your risk unnecessarily.

US Dollar Index DXY forecast and prediction
Long positions will be possible on the way up to monthly supply imbalance located around 99 price level for those forex traders trading short-term and intraday forex trading strategies. There is a lot of room for the Dollar Index to keep on rallying. There is nothing to prevent the Dollar Index from the bullish correction if it continues to make higher highs.


Supply and demand forex trading strategy