The Law of Effort VS Result

The Law of Effort VS Result

The Law of Effort vs. Results – divergencies and disharmonies between
volume and price often presage a change in the direction of the price
trend.


so by the transactions taken place and what effect it has on price and
the market u can judge the quality /quantity of supply or demand..
simply put if u see an increase on demand ie.. the people laying the shit
out of the market, huge amounts get traded on the backside but price
doesent move, the effort was huge.. but the result was zero to nill..

this states that supply is outrunning demand at this level and u should
either get out of a position or think about backing first. but deffenetly
dont want to lay here....

on the other side if u have little effort. behind a big move
then we can speak of a lack of either demand or supply..

examples on Effort vs Result.:



here we have a situation where the layside is clearly heavier



we see that 1700 have been trading @ 2,90 where previously have been
840 but we still see 40 on the backside.. ok this isnt much .. but
we didnt go Lay .. so there is more money resting (iceberg) then we see
wich indicates supply

now lets see whats happening to the backside



the backside even increases after that.. so instead of jumping
infront of the train here.. caution is advised .. as the backside only looks weak
but infact isnt..



another 1k get traded @2,88 but we didnt go Lay here .. where previously 600 where sitting.. this indicates true supply and a heavy resistance,,

so we had two situations where the effort (high volume) has been tarded but the result was poor.. in this case supply is stronger then demand!

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