Why Does Price Return To Points Where Smart Money Bought/Sold In The Past?

Hello dear mentor,

How are you, Hope you are well what i always pray for. I want to give you a big thanks at first. Cause when i come to touch with your website, my whole trading concept are changed!

Your article are very much logical and make sense to me.

Although at some point i am not clear till now.

Hope you will clarify my confusion.

My two queries are…

  1. 1. You again & again say that bank is the main fuel of forex market movement. But one thing, there are so many bank and big financial institution who participate in forex market. How all particular bank & financial institution buying or selling in the same zone or take out profit in the same zone which create supply or demand zone..!!! How this is possible? Great confuse for me. Hope you can tell me how this could be possible!

2. You told that banks & big financial institution create supply or demand zone by placing trade or take out profit from there placed trade. But in which based or condition they take a trade or in which condition they take out there profit. Can you clarify me?

Dear mentor i hope you give answer my above questions. I will be very pleased if you response my message with proper direction.

Eagerly waiting for your reply.

A lot of good wishes for you from heart. May god bless you always. Pray for your longer,healthier and happier life.

Best of luck.

Thank you…

My Response:

It might surprise you to know… there’s actually a limited number of banks participating in the forex market.

In fact, the market is dominated by just ten banks, which account for a staggering 66.9% of the daily market volume. The remaining volume comes from a myriad of sources like retail speculators, like you and me, hedge funds, and retail market makers.

As the banks wield such substantial control over the daily volume, they essentially steer the direction of the market, both in the short term and long term.

Now, let’s address why the market often revisits areas where banks have either taken profits or placed trades. This occurs because different banks might wish to execute their trades around the same price.

For instance, when the market shifts from a downtrend to an uptrend, multiple swing lows may form, each one created by a different bank entering their trades or one bank entering multiple trades at a similar price. I try to avoid getting into this level of detail in my articles, as it tends to overcomplicate the analysis.

To simplify matters, it’s easier to assume one bank is making all the decisions. This isn’t far from the truth, given the significant market control a tiny group of banks wield.

Your second question seems a bit unclear to me…

Are you asking how to determine when the banks will take profits or place trades?

Looking forward to hearing back from you.

PAN.

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