I just noticed that when the market is extremely volatile, it's similar to the current situation where there is global risk. The fundamental factors driving prices across all assets—from stocks, oil, gold to digital assets—are the same old story: supply and demand, meaning the desire to buy and the desire to sell. Simply put. But in reality, it’s more complex than that.

Let's dive deeper into what supply and demand really mean. On the demand side, it’s the desire to buy goods at different prices. If the price goes up, people buy less. If the price drops, people want to buy more. This is caused by two reasons: when prices fall, our wallets become more valuable (Income Effect), and we compare it to other goods and see that it’s cheaper (Substitution Effect).

As for supply, it’s the sellers’ side. When prices are high, sellers want to sell more. When prices are low, sellers don’t want to sell. This is the opposite of demand. And this is the key point: the actual market price occurs at the equilibrium point, where the demand and supply curves intersect. At this point, the quantity buyers want to buy equals the quantity sellers want to sell.

What’s interesting is that when a supply shock occurs—like in March when the Hormuz Strait was closed, causing over 20% of the world’s oil to disappear from the market—while demand remains the same, oil prices surged rapidly. This is an application of the demand and supply principle, meaning the balance between the two sides.

In financial markets, factors affecting demand are similar, such as interest rates. When interest rates are low, investors seek higher returns in the stock market. Investor confidence and liquidity in the financial system also play roles. The supply of stocks depends on company decisions, such as share buybacks, capital increases, or IPOs of new companies.

Once we understand this principle, we can analyze stock prices. If stock prices go up, it indicates strong buying (demand). If prices go down, it shows strong selling (supply). In technical analysis, traders use tools like candlestick charts. A green candle (closing price higher than opening) indicates buying pressure. A red candle (closing price lower than opening) indicates selling pressure.

Finding support and resistance is another method. Support levels are points where buying interest is strong enough to prevent prices from falling further. Resistance levels are points where selling interest is strong enough to prevent prices from rising further. The Demand Supply Zone technique, popular in trading, involves looking for moments when prices lose balance—rising or falling sharply—and then reversing or continuing the trend.

The key lesson is understanding that supply and demand mean the balance between buyers and sellers. It’s not difficult if we observe and practice with real prices regularly.