Don't worry about the colours, just using red for this area.
Supply and demand in a nutshell by Alfonso Moreno
- #102
- Jun 5, 2013 12:51pm Jun 5, 2013 12:51pm
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Set and Forget supply and demand trading community
- #104
- Jun 5, 2013 1:54pm Jun 5, 2013 1:54pm
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Set and Forget supply and demand trading community
That would make more sense IF you didn't have that big X area with so much trading. That demand area in blue is a reaction to that bad area. Try to find areas that are not a reaction to pre areas. That when you look down and left there is no previous demand. Ppposite for supply area, look up and left so that price is not a reaction to previous supply. Don't cut through candles, up and left for supply, down and left for demand. Hope that helps. I will try to make ll video very soon about all that! {quote}
Hi Alfonso. I attached a pic of USD/JPY with a demand level. it is a 6 hour chart, so you can see the bigger picture. just wondering what your thoughts would be at this demand level? My only concern is on the WEEKLY chart price has reversed and is more in a supply area. would you go long on this level. or would you wait to find a short since it is at a weekly supplyish area? my other concern is to the left of that demand area price has been there a few times. i guess not as fresh. Thanks for the comments
I've created another video which you can see in this post. This time it's a shorter one
The # 2 chart is a daily with the same supply level from the weekly. Question. price looks like it spent some time at this daily supply level for a while. does not look as strong anymore for a short? what do you think?
The #3 chart is a 4 hour chart. I went down to the 4 hour and there is a tighter supply area as you can see. DROP BASE DROP. Question, would you short at that 4 hour supply area Drop base Drop? my only concern is the supply area above it, for how much time it spent at that level concerns me?
- #110
- Jun 7, 2013 1:02am Jun 7, 2013 1:02am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
It looks like I had a short triggered last night on AUDCAD, it's 100 pips now and stops are are breakeven and locked in some pips and profits.
I had 2 short orders ready on the AUDCAD downtrend. H4 supply have been respected all the way down always, and demand has been absorbed, so every fresh supply level will have a short order on my chart, every red level will have an order. So this was the lower one, it was triggered first.
We're now at D1/WK demand area, I should be thinking of closing my order, but the weekly is wicky and it might penetrate it even further, there are no fresh levels lower either, so I moved my SL above a swing high on M15 and waiting to see what happens.
You can see my charts undernearh.
I had 2 short orders ready on the AUDCAD downtrend. H4 supply have been respected all the way down always, and demand has been absorbed, so every fresh supply level will have a short order on my chart, every red level will have an order. So this was the lower one, it was triggered first.
We're now at D1/WK demand area, I should be thinking of closing my order, but the weekly is wicky and it might penetrate it even further, there are no fresh levels lower either, so I moved my SL above a swing high on M15 and waiting to see what happens.
You can see my charts undernearh.
Set and Forget supply and demand trading community
- #111
- Jun 7, 2013 1:21am Jun 7, 2013 1:21am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
I've been chasing the pound long entries all the way up but gave no entry at all, neither on H1 nor H4 demand areas, which are the timeframes I normally trade. I've been adding limit buy orders all the way up since it's been in an uptrend on H4/D1 charts for some time.
It has now reached a D1 supply area on a WK supply area, right at the proximal line of the WK supply area. I have a limit buy order down below at the retest of that trendline where that 22 pips H4 demand level is located, which also matches a 30% fibonacci retracement on the D1 chart measured from the very bottom. It's the only level available for now, today is NFP news so it's good I have my levels distant from price.
I draw the 20 and the 50 EMAs because on a trend they are respected, it's another confluence when looking for levels and you want to filter out a couple, if it matches one of those emas and it's fresh, nice depearture, it's just an "extra" point.
If there are new supply levels formed on this area, I will short them on the way down to my long entry. I didn't go short on the H4 supply level because I'm trying to do mostly "with the trend", and will only counter trend on levels like this, but adding rules to my trading plan for this. Most of my losses are counter trend, so I'm going to remove them from my entries unless there are some conditions met.
This is the H4 chart:
D1 chart, waiting for a solid break of price 1.5690, then price might penetrate even further on the WK supply. I have an alert set on that price and also a solid break of 1.5900
WK chart, as you can see the D1 supply zone is right at the WK's proximal line. The WK is still on a downtrend and it's the first time there.
It has now reached a D1 supply area on a WK supply area, right at the proximal line of the WK supply area. I have a limit buy order down below at the retest of that trendline where that 22 pips H4 demand level is located, which also matches a 30% fibonacci retracement on the D1 chart measured from the very bottom. It's the only level available for now, today is NFP news so it's good I have my levels distant from price.
I draw the 20 and the 50 EMAs because on a trend they are respected, it's another confluence when looking for levels and you want to filter out a couple, if it matches one of those emas and it's fresh, nice depearture, it's just an "extra" point.
If there are new supply levels formed on this area, I will short them on the way down to my long entry. I didn't go short on the H4 supply level because I'm trying to do mostly "with the trend", and will only counter trend on levels like this, but adding rules to my trading plan for this. Most of my losses are counter trend, so I'm going to remove them from my entries unless there are some conditions met.
This is the H4 chart:
D1 chart, waiting for a solid break of price 1.5690, then price might penetrate even further on the WK supply. I have an alert set on that price and also a solid break of 1.5900
WK chart, as you can see the D1 supply zone is right at the WK's proximal line. The WK is still on a downtrend and it's the first time there.
Set and Forget supply and demand trading community
- #112
- Jun 7, 2013 1:34am Jun 7, 2013 1:34am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
I had a short order planned USDJPY on H4 but price dropped even more without me, it even absorbed previous D1 demand area and broke it, so now the next D1 demand area is at 9342, lots of room for price to keep on dropping.
On the fast drop there was a nice M30 speedbump formed, so I also placed a short order there. Speedbumps (drop base drop in this case) are the best continuation pattern, it's based on supply and demand like the valleys and peaks (swing lows and highs). Valleys and peaks are "normally" to other levels, most of the time reaction to speedbumps.
There was a brand new speedbump supply formed on H4 during the asian session (GBPJPY did the same exact thing). It was 55 pips wide which could have been drilled down to the H1 chart, but I was sleeping and I couldn't trade it, so my M30 order is still up there waiting because I won't trade an area that has been already touched like the green H4 speedbump supply.
Longterm D1 uptrend trendline has been violated, so we now even have permission to sell, lots of room to previous D1 demand area
H4 chart:
Attachment
M30 speedbump supply entry, where the big and nice steep departure is waiting for me to trade it
My D1 chart:
On the fast drop there was a nice M30 speedbump formed, so I also placed a short order there. Speedbumps (drop base drop in this case) are the best continuation pattern, it's based on supply and demand like the valleys and peaks (swing lows and highs). Valleys and peaks are "normally" to other levels, most of the time reaction to speedbumps.
There was a brand new speedbump supply formed on H4 during the asian session (GBPJPY did the same exact thing). It was 55 pips wide which could have been drilled down to the H1 chart, but I was sleeping and I couldn't trade it, so my M30 order is still up there waiting because I won't trade an area that has been already touched like the green H4 speedbump supply.
Longterm D1 uptrend trendline has been violated, so we now even have permission to sell, lots of room to previous D1 demand area
H4 chart:
Attachment
M30 speedbump supply entry, where the big and nice steep departure is waiting for me to trade it
My D1 chart:
Set and Forget supply and demand trading community
- #113
- Jun 7, 2013 1:53am Jun 7, 2013 1:53am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Planning some longs on GBPCAD. 1.5965 high was broken, so it might not make it lower.
Too much trading in the zone in the upper H1 zone, it produced 2 rallies in price, so not fresh anymore, so I'm taking the lower H1 demand area. The lower area is located within a H4 speedbump demand, I drilled it for smaller risk.
The H4 and H1 20 EMA are being respected in a trend, the cad and aud pairs do that when they are in a nice trend, so it might not drop lower. But my rules will not allow me to take a non-fresh level with that look on H1/H4. I prefer the fresh levels, it's higher odds. I was sleeping when those areas were hit and produced those new highs.
H1 chart:
H4 chart:
Too much trading in the zone in the upper H1 zone, it produced 2 rallies in price, so not fresh anymore, so I'm taking the lower H1 demand area. The lower area is located within a H4 speedbump demand, I drilled it for smaller risk.
The H4 and H1 20 EMA are being respected in a trend, the cad and aud pairs do that when they are in a nice trend, so it might not drop lower. But my rules will not allow me to take a non-fresh level with that look on H1/H4. I prefer the fresh levels, it's higher odds. I was sleeping when those areas were hit and produced those new highs.
H1 chart:
H4 chart:
Set and Forget supply and demand trading community
- #114
- Jun 7, 2013 2:06am Jun 7, 2013 2:06am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
My AUDUSD analysis and tradeable levels.
This is an example of a H4 speedbump supply (continuation pattern) that we shouldn't lean on to short. Why? Because we've reached higher timeframe D1/WK supply where price is supposed to react or even turn. This is why it's in purple (I don't trust it because it's too low or high in the curve, but it's still a valid level). Profit margin was not good either, why? Demand is gaining control.
I had plannned yesterday a long from a new H1 demand level formed after that H4 demand area was hit, but it has not made it there yet.
H4 chart:
H1 chart:
Look how low we're on the D1 chart, longs should be what we should be looking for so low in the curve.
This is an example of a H4 speedbump supply (continuation pattern) that we shouldn't lean on to short. Why? Because we've reached higher timeframe D1/WK supply where price is supposed to react or even turn. This is why it's in purple (I don't trust it because it's too low or high in the curve, but it's still a valid level). Profit margin was not good either, why? Demand is gaining control.
I had plannned yesterday a long from a new H1 demand level formed after that H4 demand area was hit, but it has not made it there yet.
H4 chart:
H1 chart:
Look how low we're on the D1 chart, longs should be what we should be looking for so low in the curve.
Set and Forget supply and demand trading community
- #115
- Jun 7, 2013 2:48am Jun 7, 2013 2:48am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Planning a short trade on AUDJPY. Let me do a quick topdown analysis with Supply and Demand in mind, like I always do. I will see if I can place a trade in the end, I'm doing this real time, so we'll see if there is a nice fresh and authentic level to lean on to short AUDJPY.
Let's start with the monthly chart.
Monthly speedbump demand has been absorbed. Lots of room to lower MN demand at 82.72 where there will probably be a bounce like on most MN SD areas.
Weekly chart: This is the previous demand level on the WK chart, it's a speedbump (continuation pattern). In fact there are two levels. We should be looking for longs there.
Daily chart: All D1 demand areas have been absorbed, and D1 supply areas respected, forming new D1 supply on the way down. There are 2 authentic fresh zones down below, the first one at 87.94 is within the previous WK demand speedbump (you can see the - - - green trendlines automatically painted with my rectangle extender indicator)
H4 chart: this, together with the H1 chart are my entry timeframes 99% of the time.
- I had a short order planned at 96.46 as you can see but price never made it, it is a level within a D1 supply zone, you can see the automatic trendlines painted by my recangle extender indicator. Then price has keep on dropping with no entris on the H4 chart, but there was one entry on the green level if drilled down to H1, however I was not there so I couldn't plan it.
- The lower H4 supply level is the one I am now focused on, all supply levels are being respected, whereas demand levels are being violatated consistently. Why should I trade the green level? So will plan a short within that H4 area. It's 67 pips wide, too much risk, so I need to drill it down to the H1 chart.
- The lower H4 demand area can be a nice long opportunity, it's a fresh H4 demand level right at the WK demand area, as you can see with the - - - - trendlines painted automatically by the rectangle extender indicator.
H1 chart:
- The H4 timeframe is just too wide, too much risk. 67 pips + spread + some wiggle room above (normally 5-7 pips on H4 charts), so I will try and see if I can find a good H1 supply area to lean on on that wide H4 supply zone
- You can see there is a nice H1 supply level right at the distal area of H4 supply demand (which you can see with .... trendlines painted automatically by the rectangle extender).
- There is a lower area that could trigger the short (purple), but I want to focus on the top one. When there is a level on top of level, I will focus on the upper one, it's higher odds, when the lower supply is absorbed, demand will be "exhausted". If I lean on the lower one, price could easily break it, reach the upper supply zone and have a loss, so I focus on the top one.
Hope this analysis helps, this is more or less the way I always trade. Hope it makes sense to you.
Thanks for reading me,
Alfonso
Let's start with the monthly chart.
Monthly speedbump demand has been absorbed. Lots of room to lower MN demand at 82.72 where there will probably be a bounce like on most MN SD areas.
Weekly chart: This is the previous demand level on the WK chart, it's a speedbump (continuation pattern). In fact there are two levels. We should be looking for longs there.
Daily chart: All D1 demand areas have been absorbed, and D1 supply areas respected, forming new D1 supply on the way down. There are 2 authentic fresh zones down below, the first one at 87.94 is within the previous WK demand speedbump (you can see the - - - green trendlines automatically painted with my rectangle extender indicator)
H4 chart: this, together with the H1 chart are my entry timeframes 99% of the time.
- I had a short order planned at 96.46 as you can see but price never made it, it is a level within a D1 supply zone, you can see the automatic trendlines painted by my recangle extender indicator. Then price has keep on dropping with no entris on the H4 chart, but there was one entry on the green level if drilled down to H1, however I was not there so I couldn't plan it.
- The lower H4 supply level is the one I am now focused on, all supply levels are being respected, whereas demand levels are being violatated consistently. Why should I trade the green level? So will plan a short within that H4 area. It's 67 pips wide, too much risk, so I need to drill it down to the H1 chart.
- The lower H4 demand area can be a nice long opportunity, it's a fresh H4 demand level right at the WK demand area, as you can see with the - - - - trendlines painted automatically by the rectangle extender indicator.
H1 chart:
- The H4 timeframe is just too wide, too much risk. 67 pips + spread + some wiggle room above (normally 5-7 pips on H4 charts), so I will try and see if I can find a good H1 supply area to lean on on that wide H4 supply zone
- You can see there is a nice H1 supply level right at the distal area of H4 supply demand (which you can see with .... trendlines painted automatically by the rectangle extender).
- There is a lower area that could trigger the short (purple), but I want to focus on the top one. When there is a level on top of level, I will focus on the upper one, it's higher odds, when the lower supply is absorbed, demand will be "exhausted". If I lean on the lower one, price could easily break it, reach the upper supply zone and have a loss, so I focus on the top one.
Hope this analysis helps, this is more or less the way I always trade. Hope it makes sense to you.
Thanks for reading me,
Alfonso
Set and Forget supply and demand trading community
I had a short order planned USDJPY on H4 but price dropped even more without me, it even absorbed previous D1 demand area and broke it, so now the next D1 demand area is at 9342, lots of room for price to keep on dropping. On the fast drop there was a nice M30 speedbump formed, so I also placed a short order there. Speedbumps (drop base drop in this case) are the best continuation pattern, it's based on supply and demand like the valleys and peaks (swing lows and highs). Valleys and peaks are "normally" to other levels, most of the time reaction...
I have my already had the that exact order set for USD/JPY. I saw that it broke through that D1 demand level and made that new little level on the M30. It will be interesting the way it will play out. I have been soaking up all your postings, and it has been helping me. it actually help me pick that level. Thanks Alfonso
- #117
- Jun 7, 2013 3:11am Jun 7, 2013 3:11am
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Glad my posts and my way of trading SD is helping you, we saw the same level which is good, we are thinking alike. This way of trading SD is based on Sam Seiden (OTA) with some additions by myself to accommodate my style as a trader.
See how the lower H4 supply area worked and the retest produced a sell entry, I was sleeping so I couldn't take it. Still that M30 supply and the upper H4 supply are good areas, they are fresh and authentic/original (no reactions to anything else, best levels).
If levels work it's great, if they don't it's great as well. We just have to follow the rules, it's a numbers game after all, probabilities not absolutes, like TraderinSD says
Alfonso
See how the lower H4 supply area worked and the retest produced a sell entry, I was sleeping so I couldn't take it. Still that M30 supply and the upper H4 supply are good areas, they are fresh and authentic/original (no reactions to anything else, best levels).
If levels work it's great, if they don't it's great as well. We just have to follow the rules, it's a numbers game after all, probabilities not absolutes, like TraderinSD says
Alfonso
{quote} I have my already had the that exact order set for USD/JPY. I saw that it broke through that D1 demand level and made that new little level on the M30. It will be interesting the way it will play out. I have been soaking up all your postings, and it has been helping me. it actually help me pick that level. Thanks Alfonso
Set and Forget supply and demand trading community
Planning some longs on GBPCAD. 1.5965 high was broken, so it might not make it lower. Too much trading in the zone in the upper H1 zone, it produced 2 rallies in price, so not fresh anymore, so I'm taking the lower H1 demand area. The lower area is located within a H4 speedbump demand, I drilled it for smaller risk. The H4 and H1 20 EMA are being respected in a trend, the cad and aud pairs do that when they are in a nice trend, so it might not drop lower. But my rules will not allow me to take a non-fresh level with that look on H1/H4. I prefer...
I was looking at that GBPCAD trade you took, and saw that i broke that demand level very strongly to the next demand distal (1.57880) and proximal (1.57960) area and bounced off very strongly. I am just trying to figure out why it could of broke through that upper demand level. I zoomed out to the D1 and saw that is near its higher timeframe supply level and looks liike it is on a down trend. shouldnt we start looking for supply levels now because it looks like supply is in control because of how it broke through that upper demand level. what do you think
- #119
- Jun 7, 2013 5:33pm Jun 7, 2013 5:33pm
- | Commercial User | Joined Aug 2011 | 3,559 Posts
Set and Forget supply and demand trading community