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Price Will Tell - Supply/Demand Price Action Trading

  • #1,541
  • Jul 6, 2017 3:06pm Jul 6, 2017 3:06pm
Quoting tintin1
{quote} related to the above regarding a supply zone is tested or not and how immediately it tests the zone. i find the following CL 5 min chart interesting {image} the zone 1 is supply tested by zone 2 which makes it R then zone 2 is immediately tested by zone 3 and makes it R then zone 4 immediately tested by zone 4 and makes R so at this point only fresh untested zone is 4 and we should look for reaction there ans ignore the other zones as they r tested already(they may or may not reacts but the odds r low) Also is this is called stacked supply...
My side, compression would normally relate to how price approached a zone or level and not how it departed from it. On that basis I've marked compression as I see it.

In terms of the stacked supply zones, I can't actually see on your original image whether or not the zones have been tested. Having said that, your zone 4 looks definitely untested so that would potentially be an area of interest should price retest again.

The BRL should be marked on your chart. We could also, in effect, mark a number of other BRLs as well (now added in dotted lines). Any one of them deserves our attention and could have given a reaction.

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  • #1,542
  • Jul 6, 2017 3:09pm Jul 6, 2017 3:09pm
There's a compression heading up into a weak looking supply zone here on M15 Oz. Worth a watch in real-time.
Bit tired now, so no more posting for me today. Will be back tomorrow.

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  • #1,543
  • Jul 6, 2017 3:21pm Jul 6, 2017 3:21pm
Quoting simond2002
{quote} My side, compression would normally relate to how price approached a zone or level and not how it departed from it. On that basis I've marked compression as I see it. In terms of the stacked supply zones, I can't actually see on your original image whether or not the zones have been tested. Having said that, your zone 4 looks definitely untested so that would potentially be an area of interest should price retest again. The BRL should be marked on your chart. We could also, in effect, mark a number of other BRLs as well (now added in dotted...
I think I have to practice drawing the BRL lines properly. I see BRL lines all over the chart.
I assume the BRL is the Support/Resistance broke by the Supply or Demand which indicates a direction change
  • #1,544
  • Jul 6, 2017 8:17pm Jul 6, 2017 8:17pm
I'd view compression the same way as Simon. Also have some thoughts...

On the first picture you posted I would have X'd out the same zone because there was a lot of sideways movement right above so in that situation you don't know where exactly your potential reversal zone is.

I'd say the principle behind the BRLs goes back to
what one of my trading teachers always said. "Price returns to where the bodies are buried." In other words, where people just got stopped out. Whether you draw them at the closes or the high/low is probably up to you. I just made some markups on my phone but can't attach them. Just look at the 2 most obvious lows that were taken out in that CL move south, those would be the BRLs to me (exactly where the blue lines are already)
  • #1,545
  • Edited 10:20pm Jul 6, 2017 8:38pm | Edited 10:20pm
Quoting rudy5
I'd view compression the same way as Simon. Also have some thoughts... On the first picture you posted I would have X'd out the same zone because there was a lot of sideways movement right above so in that situation you don't know where exactly your potential reversal zone is. I'd say the principle behind the BRLs goes back to what one of my trading teachers always said. "Price returns to where the bodies are buried." In other words, where people just got stopped out. Whether you draw them at the closes or the high/low is probably up to you. I just...
Hello Rudy Thanks for the reply. Please do post the charts you marked later when u have time
Yeah when i draw the blue line that what I thought. means Im drawing the BRL. But Simon's BRL lines in teh picture made me worry i drawn them wrongly.

Plan
1).find the obvious supply and demand
2).draw the BRL's those supply and demand took out
3). on return to those supplt/demand look for PA and take the trade

Now learn to properly identify supply, demand. then properly draw the BRL's
the identify the PA. Im new to PA so have to learn that too. will learn it by looking at the charts posted by you and Simon and others
  • #1,546
  • Jul 6, 2017 9:59pm Jul 6, 2017 9:59pm
Currently looking at this supply area to short. the thick blue lines are BRL's

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  • #1,547
  • Jul 7, 2017 3:37am Jul 7, 2017 3:37am
Quoting tintin1
{quote} I think I have to practice drawing the BRL lines properly. I see BRL lines all over the chart. I assume the BRL is the Support/Resistance broke by the Supply or Demand which indicates a direction change
Yes, broadly speaking. I would adjust the statement slightly, however, but bear in mind I do tend to be quite clinical with my approach !

"the BRL is the Support or Demand, or Resistance or Supply broke by the Supply or Demand which indicates a potential direction change"
  • #1,548
  • Jul 7, 2017 3:39am Jul 7, 2017 3:39am
Quoting tintin1
Plan 1).find the obvious supply and demand 2).draw the BRL's those supply and demand took out 3). on return to those supplt/demand look for PA and take the trade
Sounds like an excellent plan.

Plan 1).find the obvious supply and demand 2).draw the BRL's those supply and demand took out 3). on return to those supplt/demand and the BRLs along the way look for PA and if PA that I recognise sets up take the trade if there is sufficient potential RR
  • #1,549
  • Jul 7, 2017 3:41am Jul 7, 2017 3:41am
Quoting rudy5
Whether you draw them at the closes or the high/low is probably up to you.
That's a good point. I draw my BRLs on Open/Close because these are the price data MT4 uses to draw line charts as well.
  • #1,550
  • Jul 7, 2017 3:53am Jul 7, 2017 3:53am
GBPJPY

W1

Haven't traded this pair at all this year due to this flag:

Attached Image


H4

Under 10 minutes left to close and doesn't at this moment in time seem like it wants to close below the lows:

Attached Image


M15

Price sitting at the BRL:

Attached Image


With UJ still quite strong, if the lower TFs give a buy signal, will try a long on this pair.
  • #1,551
  • Jul 7, 2017 5:08am Jul 7, 2017 5:08am
Quoting simond2002
M15 Price sitting at the BRL: {image}
So.. the BRL held price up but instead of re-accumulating, the market has formed a flag than dropped lower. This is how it goes.

Note: it may have looked on Daily like an attempt to buy at supply but that supply zone was tested quite a while ago and while it's still resistance, this morning's collapse in price to the BRL looked like it had the potential to form a bullish breakout.

Attached Image
  • #1,552
  • Jul 7, 2017 6:51am Jul 7, 2017 6:51am
GBPJPY M30

Price has tested the demand zone and touch-traders would be well into profit by now. Personally I didn't yet get a buy signal but this is a good pair to watch now for real-time "eye-training" on how (if it all of course) a signal PA plays out at the zones.

Attached Image
  • #1,553
  • Jul 7, 2017 7:54am Jul 7, 2017 7:54am
Quoting simond2002
{quote} Sounds like an excellent plan. Plan 1).find the obvious supply and demand 2).draw the BRL's those supply and demand took out 3). on return to those supplt/demand and the BRLs along the way look for PA and if PA that I recognize sets up take the trade if there is sufficient potential RR
Many thanks Simon for the encouragement.
what r the kind of PA's one would look for in those areas? one i think of engulf, but if the engulf didn't retrace we miss the opportunity. I'll take a look at your charts for the PA you are looking for. when you have time if u can tell what u look for as PA that will be awesome

Thanks
  • #1,554
  • Jul 7, 2017 9:05am Jul 7, 2017 9:05am
Quoting tintin1
what r the kind of PA's one would look for in those areas?
The structure of signal PA is the one thing I wouldn't ever discuss on a public forum. There's a number of reasons for this, but basically the PA I look for is varied but very specific. Moreover, to share that kind of structure would be tantamount to giving signals, which is also not something I will ever do.

The one thing I would say is that the PA we need to look for must print bullish in structure if we're aiming to buy it, and bearish in structure if we're aiming to sell. A good place for you to start is yesterday's Oz M15 demand zone at 0.7575 that I posted (sorry can't remember which post but it's here somewhere if you look). Observe how price reacted when it tested the zone. Make a judgement about where the bullish PA came in, and on that basis, make a judgement about where you would have considered buying it.
  • #1,555
  • Jul 7, 2017 2:05pm Jul 7, 2017 2:05pm
Many information for today
good job Simond

as I promise I am learning
  • #1,556
  • Jul 8, 2017 9:45am Jul 8, 2017 9:45am
Quoting simond2002
{quote} The structure of signal PA is the one thing I wouldn't ever discuss on a public forum. There's a number of reasons for this, but basically the PA I look for is varied but very specific. Moreover, to share that kind of structure would be tantamount to giving signals, which is also not something I will ever do. The one thing I would say is that the PA we need to look for must print bullish in structure if we're aiming to buy it, and bearish in structure if we're aiming to sell. A good place for you to start is yesterday's Oz M15 demand zone...
Fair enough Simon. will do my home work and follow along to find the clues and hints. still i get confused about PA anything other than engulf, even engulf is confusing because it is engulf in one time frame and a reaction in another time frame.

The best way i think to sort this out or keep it as simple rule, if an supply/demand taken out by a demand / supply( in other words an engulf) then mark that demand/supply and wait for reaction there. at this point in time I don't know what PA to look for when it returns, that's the part to learn now
  • #1,557
  • Jul 8, 2017 11:22am Jul 8, 2017 11:22am
I'm helping a friend code a trading algo and the past 2 months I've gone over the charts looking at about 100,000 candles and marking SD zones. That's one option. You will start to see patterns. Your brain will start to go crazy too though
  • #1,558
  • Jul 8, 2017 1:15pm Jul 8, 2017 1:15pm
Quoting tintin1
Currently looking at this supply area to short. the thick blue lines are BRL's {image}
this one failed miserably, it went above the supply tested an imbalance area and flagging there unless it losses the flag( which will be bearish engulf) the PA looks like bullish to me. I may be wrong as Im novice in PA reading. I take touch trades at the S/D. hence my mission to learn the PA and learn patience and wait for the big guys to show their hand (I also have to learn what constitutes the big boys showing their hand in terma of PA at important S/D and S/R)
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  • #1,559
  • Jul 8, 2017 1:27pm Jul 8, 2017 1:27pm
Whenever an impulsive move blows thru a zone, which is a lot, you have a very good chance of seeing the distal line turn into S/R as you're seeing now. Basically a BRL I guess
  • #1,560
  • Jul 8, 2017 6:13pm Jul 8, 2017 6:13pm
Quoting tintin1
it went above the supply
Another perspective...

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