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Price movement as a function of Supply and Demand 43 replies

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Demand and Supply 1 reply

Attachments: Supply and demand in a nutshell by Alfonso Moreno
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Supply and demand in a nutshell by Alfonso Moreno

Quoting pres78
{quote} This is why Sam Seiden likes good arrival also though Alfonso does not use it is because a strong arrival means strong orders backing the move. If there are enough orders we may see a barely touch or even come a few pips short of the zone. If the orders are higher in the zone we many times will see a false break of the Distal (the issue of when is a zone removed which I am still working through) to get the higher up (or lower down) orders and to also bring in the break out traders so...
What you said is key Jason. This is what I've been repeating over and over in the thread. Do not believe in what I say, test it yourself. You have to backtest and forward test the rules (some rules are unclear, ask if that is so or add your own), and then you will believe/trust in the strategy.

Quote
Sam has many videos on this also and his way differs from what Alfonso shows. My biggest frustration with this is more the lack of trades and this is something I am working through. I watch these bases form and most of the time price never comes back and if...

I do trade à la Sam Seiden, as shown on his videos. The thing is that I've seen him say things and doing the opposite on other videos. I decided to start my journey on SD trading and I eventually had to add some nuances, create the indicators you know, because I realized that there are many more opportunities strictly based on SD levels than waiting for the big imbalances. That's why some of my trades differe a bit, but the core system is the same. Why have I added those nuances? Because I've forward tested and it works, that's the only reason. Would I be taken live trades that I've not fully forward tested? Not at all, I would be silly doing that.

I love the strong imbalances, if there is a fresh and original one on an untested D1 supply, I will have an order sitting there. But, if prices does not make it there and drops without me riding that trade, why should I wait for that level if there are new lower levels go short at? That's where the middle-strong or not as strong levels idea come in, as long as we're high in the curve for trading, trendline is being respected and we're far from good original demand areas.

That's the whole logic. Is it easy? No, it's not. It takes time, like everything in life, but it's worth the effort. Patience and forward testing it yourself is key!

Hope that helps!
Alfonso
Set and Forget supply and demand trading community
Quoting sebkor6
{quote} Hi Ranagol. For me this demand zone was not that strong because of to much trading on that level. This trade was not that clear and obvious because price wasn't able to create higher highs and absorbe the upper supply level to clear out the situation. We should remember that if you have any doubt to take a trade - don't do it. It's better to wait for clear setups, when price creates HH in uptrend or LL in downtrend, and wait for correction to fresh sup/dem levels on lower tf. {image}
Hello Sebastian!
I agree with you, that D1 demand on Ranagol's chart is not too strong, too much trading in the area, it can be easily absorbed on the way down, not that higher odds. But we never know. Like you said, if you are unsure about a zone, skip it and switch to another pair with clearer levels and setups. Don't try to set a trade on all pairs that you analyze.

In the past I used to have 1-2 trades on each direction on each pair. Now there are pairs where I have nothing for days, I just wait for volatility and my rules to be true to trade.

Alfonso
Set and Forget supply and demand trading community
Quoting panoramia
I do trade à la Sam Seiden, as shown on his videos. The thing is that I've seen him say things and doing the opposite on other videos. I decided to start my journey on SD trading and I eventually had to add some nuances, create the indicators you know, because I realized that there are many more opportunities strictly based on SD levels than waiting for the big imbalances. That's why some of my trades differe a bit, but the core system is the same.
Oh I do realize that the basis of what you do is based around the concepts shared by Sam and that what you do is simply your tested variation that works for you. That is why when I personally ask you questions it is to try and fully understand your view and your thought process so that I may test and then tweak it to work for me. This is what I have always done as a trader and IMHO is what each and everyone of us need to do. My greatest success came when I found VSA but not because of the neatly packaged VSA being taught by Tom Williams (and now sold off as training packages and software by Gavin Holmes) but once I made VSA work for me in a new idea I called VZA (volume zone analysis) which is similar in some ways but very different in others from S/D trading.

Quoting panoramia
That's the whole logic. Is it easy? No, it's not. It takes time, like everything in life, but it's worth the effort. Patience and forward testing it yourself is key! Hope that helps! Alfonso
I could not agree more.
Today's zone = Tomorrow's opportunity!
Quoting sebkor6
Hi, attached eur jpy sell. Daily supply in controll. On h4 we have nice speedbump. I drilled to h1 to find new, fresh and original supply level. Always the same way of trading. {image} {image} {image}
Just one thing about that EURJPY short trade Sebastian. Remember it's just my opinion, nothing else, what I always try to do

  1. Confirmation trades are always expected at higher timeframe SD areas
  2. Price needs to hit the higher timeframe level in order to start looking for a trade, in this case the D1 supply area
  3. The D1 supply are you are looking at is used-up, 2 pullbacks, next one would be the third
  4. When there is a non-fresh D1 supply area, confirmation needs previous demand absorbed, or no trade at all. If first pullback, you can set & forget at original levels of supply though

Can the trade work? Like I always say, of course it can, but it's not part of the rules. You are not following the rules, not because you don't want to, but because you have some doubts.

It's not possible to draw a descending trendline on EURJPY, the area you went short at did not take out previous demand. Unless you just wanted to have a TL painted for another reason other than H4 trend.

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But I just wanted to point that out to you.
Alfonso
Set and Forget supply and demand trading community
Alfonso,
Could you please look at my post on page 95, post 1899
thanks
max
Quoting sebkor6
{quote} Hi Ranagol. For me this demand zone was not that strong because of to much trading on that level. This trade was not that clear and obvious because price wasn't able to create higher highs and absorbe the upper supply level to clear out the situation. We should remember that if you have any doubt to take a trade - don't do it. It's better to wait for clear setups, when price creates HH in uptrend or LL in downtrend, and wait for correction to fresh sup/dem levels on lower tf.
Quoting panoramia
{quote} Hello Sebastian! I agree with you, that D1 demand on Ranagol's chart is not too strong, too much trading in the area, it can be easily absorbed on the way down, not that higher odds. But we never know. Like you said, if you are unsure about a zone, skip it and switch to another pair with clearer levels and setups. Don't try to set a trade on all pairs that you analyze. In the past I used to have 1-2 trades on each direction on each pair. Now there are pairs where I have nothing for days, I just wait for volatility and my rules to be true...
Thanks Sebkor and Alfonso, you are right, too much trading in the area, too many wicks. I'll be looking out for those form now on.
Quoting M.4.x
Hi Alfonso, Here's my EURNZD trade, still going. I have 2 questions: - Is the speedbump at 1.6941 good place to add another short? - re. AUDNZD I thought you did not trade this pair? many thanks Max {image}
Hello Max!

Sorry, I hadn't seen your post, it's easy to miss a post because FF does not allow you to show you non-read posts, etc.

Let me answer your questions:

  1. I do not trade AUDNZD, I have that trade there because a few day ago someone asked about it, I saw it was a decent level and planned it
  2. Your EURNZD H1 speedbump is not well painted, you didn't take into account that blue candle high, part of the speedbump. It's 35 pips on my charts, the level is sitting right at last week low. It looks like a valid speedbump with the eurusd dropping at the same time having absorbed D1 demand

Alfonso

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Set and Forget supply and demand trading community
Many thanks Alfonso
I am planning a new webinar for this Thursday at NY Open since I now have again DSL broadband connection again.
Hope you had a great summer holidays! I've been travelling often during the last 2 months, been pretty busy lately. I will neither be trading at after NY Open session, nor on Friday. Its big news days, so I will take Friday off and enjoy the beach. I learnt the lesson in the past, I changed some possible losses for the beach

Date: Thursday 5th September 2013
Time: Right at New York Session Open 2:00 PM - 4:00 PM CEST

What will the Webinar cover?

- Speedbumps, when to trade them, when not to trade them
- Strong versus not so strong departure for SD levels
- The use of trendlines to establish a trend on your entry timeframe
- Live analysis based on the SD methodology
- Answer any doubts you have on any aspect of the methodolody

If you have any losing or winning trades, have them ready because we can comment on those as well

If you have sent me your email before, you don't need to do it again. If you haven't, send me a private message or fill in the form at http://panoramia.net/visitas_virtual...panoramica_360

Hope to see you there!
Alfonso
Set and Forget supply and demand trading community
What do you think about this Alfonso? EURCAD donwtrend h1, rejection from weekly supply, and price can run until d1 demand
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Watching GBPCHF to see if it gives up a long entry. I missed a great QM (quazi) set-up identified with the L,H,HH,LL and the return back to the L. This set-up was noted on another S/D forum I frequent however it brought my attention to this pair.

I have noted the non fresh Daily SCZ (supply control zone) and the Daily DCZ (daily control zone). What I like about the DCZ is that it took out the HH supply. It's a nice speedbump at the TL. Even at 71 pips you can get a 3:1 return before the proximal of the SCZ.

I will not trade this as a set and forget but if we enter the zone I will trade the PA and possible set a pending to catch a move back out of the zone but we will see if and when that happens.

I do have a PO (pending order) set on the 4hr zone within that Daily speedbump as shown on chart 2. That upper zone in purple is a 4hr zone that has been breached to the high side but not closed over so I am leaving it for testing purposes.
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Today's zone = Tomorrow's opportunity!
Quoting panoramia
{quote} Hello Myst! Thanks for your comments. I understand everybody's frustration, I had that frustration for a long time until I found a way that works for me. I backtested these kind of entries and they work most f the times, so I am taking all of them as they happen under certain conditions. No matter what I say or do, that means nothing if you don't do the proper backtesting and foward testing, that will show you that whatever you are trying to prove is working or not. Most SD traders tend to look for strong imbalances, I do as well, I LOVE...
Hi Alfonso, really didn't expect such a long and detailed reply. You have more than answered my queries, and there were many nuggests of wisdom too, in particular the importance of testing something out to gain confidence in it. That is one of the governing principles in my trading too. What I learned from your reply is that if the market dynamics, trend, bigger story etc are good, the quality of a zone is not that important because you have proven through testing that even such zones work most of the time. In fact I've observed that for myself too, that in a strong trend price often don't even retrace to the nice looking zones for an entry. GBPAUD H1 recently is a good example. I'll try looking out for the "not too good" zones, probably test them out on a demo account and like you suggested prove it to myself to gain confidence in taking them.

Just want to say a big thank you to you for all your contribution to this thread. I don't understand where you get the time and energy to try and reply to every query. Your generosity and dedication to teaching is really admirable. I've learned a lot from your thread and it has helped eradicate many mistakes that I used to make. Its funny cuz I didn't start off trying to emulate your rules but was trying to tweak my own rules based on my experience and knowledge from the various S/D threads as well as Sam's webinars. It turned out that after many months I somehow ended up with rules very similar to yours and it really made sense to me. Identifying which HTF S/D zone is in control is so paramount.

Once again thanks for all your hard work and have a great trading week! (Though you'll probably go trekking or something again due to ECB and NFP )
AUDUSD:

Daily supply fresh and original.

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Now, which 1H supply to take?

One is outside the D1 proximal line and does not touch it, even though it is very close, so I don't think that is good. The one above, however, is fresh but not original. It is right inside the daily supply, at the proximal line. I think this is a better level to take the trade on ?

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Quoting panoramia
I was also triggered short on H4 supply on AUDNZD. The kiwi (NZD) is dropping, but the aussie is strong (I am long) even though a bit over-extended, and tonight there is GDP news for the aussie... Let's see what happens with this short trade on AUDNZD. I am in, so now I can't do anything but see if it works or not! Alfonso {image}
It looks like I had a loss on AUDNZD as I had mentioned it would probably happen, due to the nature of audnzd's correlation with the AUDUSD and expected good GDP news on the AUSSIE last night. But that's fine, I just followed my rules, I didn't add any correlation rules yet to my trading plan, will probably be adding then soon, but so far, I trade all that I see.

Even though I had a loss on that AUDNZD, some of my trades reached their targets, so one loss is nothing.

My AUDUSD long is working pretty well, my EURAUD short and ADJPY long (140 pips for a 28ish pips risk) reached their targets as well, so I am happy to have 1 or a couple of losses. Instead of having a 5:1 on the audusd, I'm letting it run a little bit more, since I now have my SL protecting be under previous H1 swing low.

The ausse might provide a scale in opportunity if next supply area is taken out.

Attached you will see my AUDUSD long, my SL is now at breakeven and protected underneath the previous H1 swing. My AUDJPY long reached its target. I am not being greedy, I am setting my TPs like 5 or 7 to 1 normally, trying to buck in some profits while I finnish the personal project I am doing.

Alfonso
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Set and Forget supply and demand trading community
Alfonso,

Long at gold 1394.61 demand?

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And what do you think about my AUDUSD trade at that 1h supply zone i mentioned?
Short eURUSD at 1.31891 supply?

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Quoting Axlz
AUDUSD: Daily supply fresh and original. {image} Now, which 1H supply to take? One is outside the D1 proximal line and does not touch it, even though it is very close, so I don't think that is good. The one above, however, is fresh but not original. It is right inside the daily supply, at the proximal line. I think this is a better level to take the trade on ? {image}
Hello Axlz!

I am not thinking of going short on AUDUSD on any of those levels. The aussie is bouncing off that Monthly speedbump demand we've been talking for weeks on the webinars. Good news on the aussie after weeks of dropping like a rock. I will only short on confirmation with a nice departure removing previous demand and new established entry timeframe trend. Why? Because we're bullish at very low in the Monthly curve.

I am not trading metals lately until I solve a problem I have with indexes and metals on my EA. But as far as gold is concerned, it's bouncing off D1 demand. Now it's reached resistance (correction before the D1 demand was created). There is a H1 speedbump before at 1402.89, I would take this one (not taking it because my EA is not working properly on metals), and if it fails the H1 temporary trend would be broken and I would not take the lower speedbump.

I will be disconnecting a bit on the thread this morning, I am not having time to analyze my own trading and pairs because I am replying to all messages. Need some time to do my work

Alfonso
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Set and Forget supply and demand trading community
Quoting panoramia
{quote} Just one thing about that EURJPY short trade Sebastian. Remember it's just my opinion, nothing else, what I always try to do Confirmation trades are always expected at higher timeframe SD areas Price needs to hit the higher timeframe level in order to start looking for a trade, in this case the D1 supply area The D1 supply are you are looking at is used-up, 2 pullbacks, next one would be the third When there is a non-fresh D1 supply area, confirmation needs previous demand absorbed, or no trade at all. If first pullback, you can set & forget...
thank's for the lesson Alfonso .
still a lot to learn.
Quoting panoramia
I am planning a new webinar for this Thursday at NY Open since I now have again DSL broadband connection again. Hope you had a great summer holidays! I've been travelling often during the last 2 months, been pretty busy lately. I will neither be trading at after NY Open session, nor on Friday. Its big news days, so I will take Friday off and enjoy the beach. I learnt the lesson in the past, I changed some possible losses for the beach Date: Thursday 5th September 2013 Time: Right at New York Session Open 2:00 PM - 4:00 PM CEST What will the Webinar...
Good morning Alfonso

If there is time, perhaps there's a couple of aspects of your trading you might look to cover in addition:

  1. Your use of the weekly high/low beads
  2. The accumulation/distribution pattern you've referred to in the past

Regardless, I'm looking forward to the next webinar.

All the best.

Huk

Hi guys and Alfonso,

i want to know how u trade on areas of daily resistance zones.
as shown on the chart, Daily trend is up and making HH-HLs.
everytime price reaches Daily fresh demand levels we are allowed to buy on lower timeframe
and we know that if we are in an up trend, we should take out previous Daily highs.
with the expectation of being able to take these previous highs, also we can see that resistance
trades are coming on board and slightly turning the price downward on resistance areas (as shown with grey arrow).

so on the lower timeframe how should we react on those resistence areas.
i come up with 3 ideas;

1- after buying on lowertime frame areas, keep buying all the fresh levels along with the trading timeframe TL until u reach resistance zone and then stop buying at all.
2- wait for pullback on Daily resistance level and draw H1 downward TL and once it brakes upward, again start to buy frsh levels.
3- or after price reaches Daily resistance zone , wait until this zone to be broken totally and then keep on buying H1 fresh demand zones again until the next Daily resistance or supply level reached.
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