Traders must keep an eye on how strong the selling pressure is at those levels. Thus we buy at demand levels because they were turning points in the past. They are levels where prices could not continue to drop and started to rise. This occurs as the supply is becoming exhausted as sellers sell shares onto the market. What will happen prices become so cheap that willing buyers jump in and support the price. When the demand from these buyers exceeds the existing supply from sellers, prices will rise. Traders should focus on that area as an area of demand where we will buy again in the future.
Forex and stock traders are looking for the consistently wrong investor, trader and take the opposite position. This will obviously lead to winning trades for them. All traders have read trading books that point out that increasing volume is good for the continuation of the trend. Many new stock traders will try and fight the trend.
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