Supply and demand in a nutshell by Alfonso Moreno

Quoting 13Paul21

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Hello, I've been learning supply and demand and I particularly enjoy this and Michael's (trading institutional order flow) thread. I have one question tho. Why do some supply and demand traders trade only from curve's FRESH zones? I mean, say a trader sees a zone that's not fresh and then a fresh zone above it. I've seen this particular scenario many times, the trader will ignore the not fresh zone and mark the fresh one only. What I do not understand is why would anyone do that, the orders are still there and the zone still holds, so far so ignoring...

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Quoting Merka

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{quote} You will have better odds going for fresh zones instead of non fresh zones. Could work out a non fresh zone? Yes. Could fail a fresh zone? yes. Trading is a probability game and it's better to have the odds in your favor. Regards

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Quoting 13Paul21

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{quote} Hi and thank you for your time, However, I do not understand a bit of a different thing . . . What you explained I completely understand and agree with. But, what bothers me is that after the trader is finished with his work on the curve timeframe, he's got marked fresh supply and demand. So he goes to a lower timeframe and looks at the trend . . . the trend is up and the price is halfway on its way from the curve demand to the curve supply. Now he goes to his entry timeframe and enters a trade because everything looks good. What happens...

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Quoting 13Paul21

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{image} GBP/USD, Daily - the sequence is D-4H-1H The curve is from the nearest fresh supply to the nearest fresh demand because I apparently don't need to care about zones that are not fresh on the curve timeframe. Say that the price drops to the nearest fresh demand on the curve timeframe. I want to go long so I look at the trend timeframe and the trend is already up and new demand was created on the trend timeframe. Now I go to my entry timeframe and I see that the price is in 1H demand inside 4H demand inside D fresh demand. That's a good opportunity...

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Quoting Merka

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{quote} A zone is always a zone so it's always necessary to take into consideration about them when trading despite their freshness or not. The aggressive trader may not draw nn fresh zones anticipating that they will removed. The conservative trader will draw all zones and before taking a trade he will wait the non fresh zone to be removed as confirmation. For example you are planning a short at SZ but below you have a nn fresh DZ. Instead of anticipating the removal of the nn fresh DZ, you will wait as confirmation the nn fresh DZ to be removed...

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Quoting 13Paul21

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{quote} So aggressive trader might not care about zones that are not fresh, he'd expect the zone to fail and set his TP somewhere depending on the nearest fresh zone. Whereas a cautious trader would respect that nn fresh zone and set his TP accordingly taking into an account the nn fresh zone. Correct?

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Quoting Merka

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{quote} Exactly. I'm personally a conservative trader and trade just what I see as per the rules without anticipating anything. Cheers

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Quoting 13Paul21

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{quote} That was a great explanation btw, you explained exactly what I wanted in a way I understood, thanks. However, you created another question lol. I can't wrap my head around that: 'The conservative trader will draw all zones and before taking a trade he will wait the non fresh zone to be removed as confirmation.' Could you please show me an example on a chart?

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Quoting Merka

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{quote} Your post #8985 is a good example. You have fresh DZ below and now tested SZ above. Assuming your top down analysis justify a long trade do you place the trade immediately? No. You will wait as confirmation the above nn fresh SZ to be removed and after you place the long trade at DZ because in this way you don't have obstacles on your way and the probability of your trade reaching TP are higher. Cheers

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Quoting 13Paul21

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{quote} So I can say that aggressive trader would ignore a nn fresh supply zone and set his TP according to the nearest fresh supply zone, and then there's a conservative trader that has two options: 1, wait for a nn fresh supply zone to be removed and then set his TP wherever the next supply (fresh/nn fresh doesn't matter) will be. 2, take trade even if the nn fresh supply zone is not removed, but set TP accordingly to the nn fresh supply zone. Is my thinking correct?

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Quoting Merka

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{quote} Yes

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Quoting papabless

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Hello everybody, I've got a question regarding zones with gaps. {image} Thanks

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Quoting Ghanam

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Hi Guys, I am new to this forum. I have an idea about Forex but I came from a different strategy. I started to follow Alfonso short time ago and I started to read the book and watch the videos. I am trying to draw the trend lines based on two peaks or valleys. I started with the monthly chart for AUDUSD. Kindly check it below. I appreciate your feed back. Kindly be informed that I drew only the most recent trend lines {image}

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Quoting panoramia

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Dollar Index DXY short bias, monthly downtrend. Dollar Index DXY has a short bias, monthly downtrend with new supply zone created overhead, shorts at daily and weekly supply imbalances around 91 and higher. There is a void to be filled if monthly lows around 91 are broken. Most USD cross pairs are filling that void already and breaking lower. Shorts as well at daily and weekly supply zones on USDCZK, USDPLN, USDSEK, USDSGD, USDCLP, USDRON, and a few more. {image} {image} How...

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Quoting 13Paul21

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{quote} That's a good question, I've been puzzled by this chart because of that for quite some time now. I've got no idea how to draw it, hope somebody smart turns up.

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