Supply and Demand represent the two most powerful forces of the market. Demand means the number of buyers buying a security in the market. Supply means the number of sellers selling a security in the market. Large supply takes the price to move down and large demand takes the price to move up. Balance in both forces will keep the price in sideways movement. There are two types of states of the price of a security in technical analysis. 1. Balanced state; 2. Unbalanced state. In a balanced state, the price is moving in a range like moving sideways. Simply means forces of buyers and sellers are balanced. Both of them don’t have the ability to create a trend either bearish or bullish trend. After breakout of this sideways (range) movement of price, imbalance in price occur. And after the breakout, the recent range will be called a base zone and the price will again come to this base zone to pick unfilled orders.
Function
This is a composite supply and demand zone indicator, which inlcude: 1. demand and supply zones: yellow color box for demand zone while fuchsia color box for supply zone 2. half-semi log based fibo levels 3. multiple time frame (MTF) manual or automatic setting to see clear trend 4. tendline drawing. Default 610 bars back to draw, you can change it to your preferred value. However, you need to guarantee the existing chart already have equal or more than the number of bars you set or 610 bars. 5. blackcat reveral labels 6. box color to indicate volume information as: box border color is green --> bullish box boarder color is red --> bearish box body color meanings: a. turquoise or aqua or cyan box body color --> no volume indicaor signal or NA --> no supply and demand signal b. red box body color --> volume climax up - strong bullish high volume --> demand >> supply c. white box body color --> volume climax down - strong bearish high volume --> supply >> demand d. green box body color --> high volume churn - bars with high volume and low range --> suppy and demand is balancing e. yellow box body color --> low Volume - bar for low volume --> bullish/bearish trend is exhausted, reversal may happen soon --> supply or demand dominance will be changed soon. f. fuchsia box body color --> volume climax plus high volume churn --> two possibilities: red+green=fuchsia or white+green=fuchsia, so fuchsia is a mixed state --> srong demand with supply attack or strong supply with demand attack.
Remarks
Free but closed sourced. If the trendline is not drawn but you can see the red resistance and green support dashed lines, please drag the the chart to the left unitl you see the yellow solid trend line appears. This is the initial version. This will be contineously improved along time.
What does it mean when the resistance line and the trendline are both broken upward? Thanks.
blackcat1402
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@pakintade, it's an automatic MTF trendline as a reference, or experiment from my perspecitve.
pakintade
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@blackcat1402, I see. Thanks for your response. If I may ask, what are the settings you use in the attached screenshot of your chart that makes the arrows appear at the exact top and bottom of price? Thanks.
buskopan0
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nice job
victorcpwong
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This is the most colourful indicator I have ever come across. The amount of details and significance the indicator shows are a lot. It takes a genius to produce such a wonderful and useful indicator.