Supply and demand in a nutshell by Alfonso Moreno

CONGRATULATIONS for the great webinar we had! You gave us a clear explanation of basics step by step, and for me, as I am newby trading S/D levels, it is a wonderful help.

I wish we can repeat forward another webinar. So many themes there. Well, still I have to study the basics in order to clear myself. I follow the thread with delight. I'm learning everyday important things about "big boys" and co. You all know what I mean...


Salut! And many thanks to this thread mentor.


toni

Thanks for your time and a great webinar, it has really helped my understanding to see S/D levels more clearly.

Joe

Really a great webinar Alfonso. Appreciate so much of the time and effort you have provided for other people to understand Supply and Demand. Thank you!

Hope we have a record of this for replay.


Francis

Hi Forex Lion,

Go to the bottom of post #1 on page #1 of this thread. The indicators are there.

leo

Hello to all members. I know that Alfonso is not here right now, but what do you guys think of this speedbump. AUDJPY trend is down in higher timeframe.

Am I missing something? Any thoughts? Once again, sorry if my english is not perfect

Hi Leo,

I did download the indis, but could not find the S+D indicator? all the other indis but not this one...?
What is the name for the S+D indi?

Thx and regards,
FL

Forex Lion, try this one.

Hi Larra,

in my opinion it looks good for a short because:
1, the uptrend has been broken due to the fact, that two demand zones have been violated
2, the Speedbump is a fresh supply zone (has not been touched)

This is was I think as a beginner, maybe Alfonso will correct me soon

Regards,
Peter

Hi Isko,

great, many thanks.

My recommendation is not to use the automatic SD indicator as a beginner or even if you have some practice on supply a demand. Why this? Because you will not know how to assess if a level is good or not, you will have many levels painted on H1 and H4 charts, many of them won't be valid because you have to assess the higher TF trend.

I would recommend not to use it for quite some time, or if you use it, do it AFTER you have added your own levels, so that:

1. You know if you were right painted them
2. You'll see others you didn't see on your initial analysis

Remember that you will see levels everywhere, but MANY of them won't be valid for your a setup. You need to make a multitiframe analysis and only those that match a "sequence", will be valid. The closer to D1 demand area for buying the better. Remember buy low and sell high!

Alfonso

I am back from my kayak afternoon on the beach after a long webinar.

The observer changes the result of the experiment, that's the basics of quantum mechanics. The same applies to trading.

The longer you spend in front of the computer, the least effective you will be, the more you will affect your trading results. That happens to all of us, I am not an exception

I had posted a short trade on AUDCAD 2 days ago, I was in as you remember. My TP was at 0.9516, my entry at 0.9695. It reached my TP while I was kayaking, about 180 pips. This is the way I should do everyday! Need to get busy to let the trades reach their targets!

The trade was based on a H4 supply area after previous demand had been absorbed, room to previous D1 demand and higher timeframe's downtrend.

I've attached a screenshot of my VPS (I don't run my MT during these hours) with the entry and the exit. I don't have my levels on my VPS; it's just a backup.

I love set & forget!

Webinar explained many basic concepts about S&D analysis. Subscribed.
Already up on youtube now, many thanks Alfonso for your clear explanations of original & fresh zones.
A difficult concept simplified, without abbreviations & gooble degook.

Looking forward to further webinars from yourself.

I've uploaded today's webinar to youtube so that all attendees and those that couldn't make it can see it.

Thank you everybody for attending my first webinar, thank you for the compliments you left on my thread, I really appreciate that. Webinar was longer than expected, it is 3 hours long. Sorry for making it so long. I had lots of things to explain and it's just impossible to do it in 2 hours, not even in 10. I should have stopped at 2 hours, because it can be a bit boring after a couple of hours. Hope you enjoyed it and things are a bit clearer now.

You can view today's webinar here:


I know it's a long webinar, but we cover MANY important and BASIC rules to trade in trending markets and some clues on what to do on counter trend. I am sure that every time you watch it, you will see something new or have some Aha moments.

Topics covered in this webinar:

1. Top down analysis for GBPAUD, from the Monthly to the H1 timeframe
2. How to draw levels and assess if they are fresh and/or originals
3. How to trade with the trend and evaluate how high or low we are in the supply and demand curve

All that amongst very small details and nuances that will help you have a clearer view on supply and demand trading.

IMPORTANT NOTE: remember my trading style is mostly 99% set & forget, I stay away from confirmation entries. I use confirmation in certain circumstances, mainly counter trend. I am not waiting for engulf patterns or any kind of candlestick pattern to confirm my entries. It does not mean that the way I do it is better or worst, it's just that it fits my trading style, nothing else. I just want to set & forget, whatever happens happens. In order to do that, you need to read the market correctly and take only clear and obvious levels with a big imbalance in price and a minimum of 3:1 or more profit margin. Buy as low as possible, sell as high in the curve as possible (with the trend), that's the plan!

Thanks for your comments Shabs, I really appreciate that, really. I try to stay away from neverending abbreviations, I don't like them. I just use SB (Solid Break) and SPB (speedbump) and not always, the rest is just price action and watching what is going on with current SD levels. I've always wanted to have a KISS (Keep It Super Simple) method, that's my goal.

I will organize another one next week, it will be mostly on how to quality and SCORE supply and demand levels based on these odds enhancers:

1. STRENGTH OF DEPARTURE
2. NUMBER OF PULLBACKS
3. PROFIT MARGIN. 3:1
4. BIGGER PICTURE
5. TIME AT LEVEL
6. ARRIVAL

It may look simple, to many it may seem obvious but most traders won't use them appropiately, they are overestimated.

Today's webinar is up. It's a bit long, but it's the basics. We all need to have those concepts as second nature!
Alfonso

again, many thanks Alfonso, ...hope you had fun at the beach?
you are so quick, already uploaded the video...wow!!!

Hi Jasmina!

I don't have my MT open, but that level of supply is a speedbump. Speedbumps are high probability when trading with the trend since it's a continuation pattern. When price reaches that area of supply, H1 will no longer be a downtrend.

Remember:
1. Use speedbumps as a continuation pattern to go with the trend you have on the timeframe you have detected and drawn the speedbump
2. Use valleys/peaks at the extreme, within the D1 SD area. They are best at extremes. Whereas the speedbumps are best with the trend, on the way up or on the way down, once an extreme has been reached, speedbumps are not trustworthy. Can many of them work? OF COURSE. But they are not high odds, so I won't take them. But do one thing, backtest them, see how they react in those zones, you will see what I mean.
3. As you said, price makes new low, but by the time price reaches that H1 speedbump supply area, what will the H1 chart look like? Will it have broken several supply areas? Yes. So not for me. We want to lean on valleys/peaks at D1 supply areas for higher odds, or wait for price to engage the downtrend again on H1

IF you still want to trade that area short... Wait for price to reach it, wait for brand new supply being formed (engulf pattern), previous demand being absorbed and go for a short. That's what I always do.

Hope that helps!
Alfonso

I am not that quick on everything Lion

I had lots of fun on the beach, the day was perfect. I had left the computer uploading the video, so I just had to come back and post the link on the thread

Alfonso

I agree with Alfonso, I myself do not use the indicator as I need to practice myself on how to paint these zones manually in order to understand what is happening.

Isko, thanks for your help.

Remember what we talked about on yesterday's webinar?

GBPAUD was at a D1 speedbump supply, D1 was in an uptrend. Speedbumps are not good when countertrend.

What happened?
- H4 supply area was absorbed, if you had traded that area on set & forget, it would have been a loss. We avoided that loss
- D1 supply area from 1.69092-1.6825 was broken, price reached 1.69175 on my broker but not solidly broken with momentum as I explained yesterday (that's why I use Solid breaks)
- The pound pairs and cross pairs tend to overshoot sd levels many times, you have to be aware of that. SL needs to cover more wiggle room. Having a level overshoot by 10 pips and sometimes more, is something you will see a lot on the pound cross pairs and other pairs. Lack of liquidity, traps, you name it.

Where are we now?
- Price is bouncing off those highs
- Price is creating brand new H1 supply areas

Is there room to reach lower D1 demand?
- Yes, there is. We can short GBPAUD
- Can we short? Asked in another way... Are we high in the Curve or are we low? Are we creating new levels of supply or demand? Look at the h1 chart and you will have your answer
- Should I worry about speedbump demand at 1.6644-1.6619. It shouldn't be a problem since it would be against current H1 trend
- Can that speedbump cause a reaction? Yes, it could, it does many times. So? If there is an opportunity, never sell close to it

Now, price confirmed to us that there are willing sellers (supply on the area), Short all good levels of supply down to the D1 demand area. In fact there was a new H1 supply level that has been formed. See how the uptrend trendline has been broken. The trade was here last night, H1 supply that closed below last week high... I was sleeping so I couldn't do anything.

The blue H1 demand level is 66 pips wide, you can't trade it, too much risk, it would go against current supply in control on H1 when price gets there. We'd need confirmation. It also looks like a reaction to a non-fresh H4 demand level. Beware!