I have been trading for over 15 years. I have tried everything. Today I am going to share with you a profitable Supply and Demand Trading Strategy I learned from Moneyball Austin. You are welcome to visit his YouTube channel. This strategy work on any instrument.
Before I dive into the system. You should know this is a multi time frame trading system.
Weekly - Daily
Daily - Hourly
Hour 4 - 15m/5m
Hour 1 - 1 minute
These are the time combination you must adhere to depending on the kind of trader you are.
Now lets dive into the system.
Step 1: DEFINING VALID SUPPLY & DEMAND AREA (HTF)
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A valid SUPPLY area should have the following characteristics.
- Must break Opposing Swing Area
- must take only 1-3 Candles to break the opposing area
- Breaker candles should not include any 50-50 candles (candles which has wicks and the wick area and body area is 50-50 in size).
Drawing Distal Line and Proximal Line: Distal line is the most distant point of the wick of the candle after which the big move came in. Proximal line is the mid area (where the candle's body closed). Many take into account the highest wick point to define the Proximal line but I prefer Body closing area.
Step 2: PLACING TRADE (LTF)
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In this example I have used a 1h-1m combination. In Order to Place trade we need the following characteristics.
- Price must come back to HTF proximal line.
- as the price touches the HTF proximal line, we draw a momentum line connecting the lows (see the image). This is important! We only draw Momentum line when price touches HTF Proximal line.
- now as the price breaks the momentum line We draw our distal and proximal at LTF in this case in 1m timeframe. Consider the point from which the move generated that breaks the Momentum line with force. If it has Fair Value Gap its better. See the image.
- Now place a pending order at proximal line.
Step 3: UNDERSTANDING STOP LOSS AND TAKE PROFIT AREA:
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- Place your stop loss 2/3 pips above Distal line.
- Now for Take profit, your may go for 1:2, or trail the swings or can use your very own method but I found a very mechanical way of taking profits. Focus on the following:
- in HTF, look for recent consolidation area on the left
- Now go to your LTF and see into that Consolidation area and look for unmitigated FVG. You can close your trade as the price Fill that FVG or reach close to it. This is the area from which price tends to reverse. So if you have a big TP, this is the area that is responsible for the loss.
Video explanation
Good Luck!!
How to find high quality supply demand area : https://www.forexfactory.com/thread/...1#post15039301
Before I dive into the system. You should know this is a multi time frame trading system.
Weekly - Daily
Daily - Hourly
Hour 4 - 15m/5m
Hour 1 - 1 minute
These are the time combination you must adhere to depending on the kind of trader you are.
Now lets dive into the system.
Step 1: DEFINING VALID SUPPLY & DEMAND AREA (HTF)
-------------------------------------------------------------------
A valid SUPPLY area should have the following characteristics.
- Must break Opposing Swing Area
- must take only 1-3 Candles to break the opposing area
- Breaker candles should not include any 50-50 candles (candles which has wicks and the wick area and body area is 50-50 in size).
Drawing Distal Line and Proximal Line: Distal line is the most distant point of the wick of the candle after which the big move came in. Proximal line is the mid area (where the candle's body closed). Many take into account the highest wick point to define the Proximal line but I prefer Body closing area.
Step 2: PLACING TRADE (LTF)
-------------------------------------------------------------------
In this example I have used a 1h-1m combination. In Order to Place trade we need the following characteristics.
- Price must come back to HTF proximal line.
- as the price touches the HTF proximal line, we draw a momentum line connecting the lows (see the image). This is important! We only draw Momentum line when price touches HTF Proximal line.
- now as the price breaks the momentum line We draw our distal and proximal at LTF in this case in 1m timeframe. Consider the point from which the move generated that breaks the Momentum line with force. If it has Fair Value Gap its better. See the image.
- Now place a pending order at proximal line.
Step 3: UNDERSTANDING STOP LOSS AND TAKE PROFIT AREA:
-----------------------------------------------------------------------
- Place your stop loss 2/3 pips above Distal line.
- Now for Take profit, your may go for 1:2, or trail the swings or can use your very own method but I found a very mechanical way of taking profits. Focus on the following:
- in HTF, look for recent consolidation area on the left
- Now go to your LTF and see into that Consolidation area and look for unmitigated FVG. You can close your trade as the price Fill that FVG or reach close to it. This is the area from which price tends to reverse. So if you have a big TP, this is the area that is responsible for the loss.
Video explanation
Inserted Video
Good Luck!!
How to find high quality supply demand area : https://www.forexfactory.com/thread/...1#post15039301
