Supply and demand often gets mixed up with support and resistance in trading. But supply and demand levels are completely different.
In my view, supply and demand is a leading trading tool for technical analysis. Supply and demand zones usually preceded support and resistance. And a trader that fully understands how to draw the right supply and demand zones can be one step ahead of most other traders.
Supply and demand zones may indicate price areas where the "big players" such as banks or banks initiate and build their trading positions. Thus, a trader may be able to use this knowledge to their advantage when it comes to identifying high probability price levels.
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