The demand curve slopes downward: as prices rise, fewer people buy. The supply curve slopes upward: higher prices push producers to make more. Where the two curves cross is the equilibrium price — the sweet spot where buyers and sellers agree.

This equilibrium is not fixed. A viral video can shift demand overnight. A drought can wipe out a wheat crop in a single season. When demand rises, prices and quantities both go up. When supply shrinks, prices rise but quantities fall.

Knowing which curve moved — and why — is the key to predicting where prices head next.