The Buyers and Sellers

Responsive Buyers/Sellers: Responsive participants react to prices that are perceived as too high or too low. They believe that the price has reached an extreme, and they respond by buying or selling to push the price back towards what they believe is the 'fair' value.

For example, responsive buyers will buy when they perceive the price as low or a good value. They're responding to what they perceive as a discount. Similarly, responsive sellers will sell when prices reach a level they consider high or overvalued. They're responding to what they perceive as an inflated price.

Initiative Buyers/Sellers: Initiative participants are the ones who drive prices away from established value areas with the expectation of a continued move. They take the initiative to buy or sell even when the price is not at an extreme.

Initiative buyers will buy even if the price is considered high, with the expectation that the price will continue to increase. Initiative sellers will sell even if the price is low, expecting the price to continue to decrease.

Feature	Responsive Buyers and Sellers	Initiative Buyers and Sellers
Trading style	Reactive	Proactive
Timeframe	Short-term	Long-term
Risk tolerance	High	Low
Profit targets	Small	Large