Supply and demand in a nutshell by Alfonso Moreno | Page 125 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #2,481
  • Sep 15, 2013 12:12pm Sep 15, 2013 12:12pm
Quoting Reacto
Hi Alfonso, I'm re-reading the rules from post one, and red this one: I will consider a downtrend has ended IF the timeframe I use as direction has broken at least 2 D1 supply zones, that simple. If 2 supply zones have been violated, then I will consider the downtrend has ended and will start looking for longs. Opposite for an uptrend. That's the very simple rule I am following. * If only 1 supply zone is broken I will not consider the trend has changed, but I will look further up to lean on the previous unbroken supply on my direction timeframe....
Quoting Nametaker
{quote} The above statement does apply to the WK/D1/H4 combo. The daily is your trend direction. So draw a trend line on daily to assess trend and for even more confirmation do the above instruction. That is how i have interpreted the post. Or it could mean the tf you have your SD curve on (WK) has to break 2 SD levels before trend is re-realised. We will wait for Alfonso to weigh in.
Hi Robert and Nick!

I've edited that Post #1 statement about the 2 broken zones to consider a change of a trend. We're also now using the trendline, so that statement has changed "a little bit" to fit with the use of the trendlines, it could lead to a little bit of confusion. Hope now it's clearer and makes sense. I will be editing Post #1 a bit from time to time so that I can cover some nuances and questions arised in the thread, which is something normal since I can't explain everything 100% correctly, there will always be better and clearer ways of explaining things.

The statement now looks like this:

We will consider a trend at any given timeframe has ended IF the trendline that connected the last 2 obvious valleys (uptrend) or peaks (downtrend) has been broken.

  1. If 2 SD zones have been taken out, then we will most likely have the possibiity of drawing a brand new trendline for our new direction, thus looking for trades in this new direction, only if there is enough room to the opposing higher timframe SD area and we are not too high/low in the curve
  2. The break of a trendline does not necessarily mean that restest of a SD zone near or at the retest of the broken trendline will be valid. We need to make sure that price has arrived or is very close to a higher timeframe area, ELSE we'll have to make for a brand new direction to the opposite side
  3. Do not trade the break of a trendline just because it's just been broken, we need to assess location in the curve

Hope that's clearer now!
Alfonso

Set and Forget supply and demand trading community
  • #2,482
  • Sep 15, 2013 12:24pm Sep 15, 2013 12:24pm
Quoting Reacto
Hi Alfonso, In general, a level is not valid until it has taken out an opposing level. With the confirmation trades we some times use an less strict rule, where the taking out of the opposing level is not necessary. So we have two types of confirmation. Can you confirm that the strict one is only applies to the fourth bullet of your text below, and the less strict one applies to bullet two and three?
Hi Robert!
Let me remind you that yes, we should wait for a confirmation trade when we hit an opposing higher timeframe area. We will not need to remove opposing lower timeframe SD area (H4 SD if we have H4 as our entry timeframe) if our HTF is fresh and/or original, we will believe that the zone has high odds and act accordingly. We will need price to remove opposing H4 SD area IF the higher timeframe area is not fresh.

Hope that makes sense!
Alfonso
Set and Forget supply and demand trading community
  • #2,483
  • Sep 15, 2013 12:30pm Sep 15, 2013 12:30pm
Quoting panoramia
{quote} {quote} Hi Robert and Nick! I've edited that Post #1 statement about the 2 broken zones to consider a change of a trend. We're also now using the trendline, so that statement has changed "a little bit" to fit with the use of the trendlines, it could lead to a little bit of confusion. Hope now it's clearer and makes sense. I will be editing Post #1 a bit from time to time so that I can cover some nuances and questions arised in the thread, which is something normal since I can't explain everything 100% correctly, there will always be better...
Much clearer Alfonso thanks, as you say, it is difficult to describe these things, but your making a very good job of it.
  • #2,484
  • Edited 12:49pm Sep 15, 2013 12:33pm | Edited 12:49pm
Quoting Reacto
Hi Alfonso (sorry, but I have another thing that is not quit clear for me) Is the fourth bullet correctly stated? The way I read it, we should never take a set and forget on in a higher time frame. Do not trade non-fresh levels on set & forget Wait for confirmation always at higher timeframe areas if they are fresh, original and/or fresh (set and forget as well here), or not used-up. Higher timeframe areas are D1, Weekly and Monthly
Hi Robert!
Don't need to say sorry... there was a typo there, sorry

The fourth bullet should say something like this:

  1. Always wait for confirmation at non-fresh higher timeframe areas. If used-up, wait for confirmation with a clear new trend in the opposite diretion

Post #1 has been edited to say exactly that. Thanks for pointing that out! Sorry
Alfonso

Set and Forget supply and demand trading community
  • #2,485
  • Sep 15, 2013 12:37pm Sep 15, 2013 12:37pm
Quoting panoramia
{quote} Hi Robert! Let me remind you that yes, we should wait for a confirmation trade when we hit an opposing higher timeframe area. We will not need to remove opposing lower timeframe SD area (H4 SD if we have H4 as our entry timeframe) if our HTF is fresh and/or original, we will believe that the zone has high odds and act accordingly. We will need price to remove opposing H4 SD area IF the higher timeframe area is not fresh. Hope that makes sense! Alfonso
Thanks Alfonso, it makes sense. Like I said, I was re-reading the rules very precise, because I want to get this right for once and for all. If I have done this right, it should be my last questions about the rules, on to applying them correctly
  • #2,486
  • Sep 15, 2013 12:52pm Sep 15, 2013 12:52pm
Hi Alfonso, could you please reflect on post 2485?
  • #2,487
  • Sep 15, 2013 1:28pm Sep 15, 2013 1:28pm
Hi,

I am trying to go through the videos but says they are private. Any ideas??
  • #2,488
  • Edited 1:44pm Sep 15, 2013 1:33pm | Edited 1:44pm
Quoting Investwiz
Hi, I am trying to go through the videos but says they are private. Any ideas??
I have deleted ALL videos from my previous account. During the next days, I will be uploading all valid videos unaffected by the problems you are all aware of.

So far there only one video available... Bear with me please, you will have a bunch of them in the next couple of days.

You can all subscribe to my new YouTube channel at http://www.youtube.com/user/supplyanddemandforex
By doing so, you will be notified every time there is a new video posted.

Last Friday's video link is now back, you can all watch it in the link below.

TRADING SUPPLY AND DEMAND LIKE A ROBOT
Inserted Video
Set and Forget supply and demand trading community
  • #2,489
  • Sep 15, 2013 1:39pm Sep 15, 2013 1:39pm
Thanks Alfonso, also just subscribed to YouTube channel

cheers
  • #2,490
  • Edited 2:16pm Sep 15, 2013 1:47pm | Edited 2:16pm
Thanks Alfonso, I have subscribed and really good webinar Friday
  • #2,491
  • Sep 15, 2013 5:05pm Sep 15, 2013 5:05pm
Well sir that's some pretty big weekend gaps...

EURUSD gapped right up into Daily supply zone... very intertesting.
Today's zone = Tomorrow's opportunity!
  • #2,492
  • Sep 15, 2013 5:07pm Sep 15, 2013 5:07pm
Quoting pres78
Well sir that's some pretty big weekend gaps... EURUSD gapped right up into Daily supply zone... very intertesting.
That feeling when price gaps straight into the lower TF zone you were waiting to enter on.

Completely ruined setups.
  • #2,493
  • Edited 7:35pm Sep 15, 2013 7:19pm | Edited 7:35pm
Quoting Reacto
{quote} Good evening Ivan, Thanks for shearing your set-ups, for me it's a great way to speed up my learning curve. I have a question on the gold set-up. Looking at the weekly, we just touched a fresh demand level, after the supply level was broken three weeks ago, not solidly, but broken still. If we follow the rules, this would mean we should look for long positions rather than short. Given Alfonso's reaction to your set-ups, I'm wondering what is it that I see wrong here? {image}
Hi Reacto,

You did not see anything wrong, except that the setup I posted was of Silver and not Gold. XAGUSD = Silver, XAUUSD = Gold. I have the same gold analysis as you and that is why I chose Silver over Gold for shorts even though both have the same D1 speed bump supply. Silver's weekly demand is still a distance away, giving any shorts more room to run.
  • #2,494
  • Edited 8:13pm Sep 15, 2013 7:58pm | Edited 8:13pm
Quoting Myst1z
{quote} Hi Reacto, You did not see anything wrong, except that the setup I posted was of Silver and not Gold. XAGUSD = Silver, XAUUSD = Gold. I have the same gold analysis as you and that is why I chose Silver over Gold for shorts even though both have the same D1 speed bump supply. Silver's weekly demand is still a distance away, giving any shorts more room to run.
I don't see why you cannot trade against weekly/monthly zones as long as you have confirmation.

The weekly speedbump demand would just mean you shouldn't take Daily supply set and forgets, as Daily levels are likely to be violated by Weekly in control.
  • #2,495
  • Sep 15, 2013 10:17pm Sep 15, 2013 10:17pm
Hi to all,

I'm new to this thread, already reading the posts here. So many great material that i need to digest. I myself was already burned using a lot of indicators and the SD methodology is the only strategy that makes sense. I like to set and forget it also, since i am working working full time. Thanks to Alfonso for all of his contributions in the trading community.

Hi Namesake,

Could you share your template that you're using to us. Your template is good to look at. Thanks a lot.
  • #2,496
  • Sep 16, 2013 12:24am Sep 16, 2013 12:24am
Quoting Myst1z
{quote} Hi Reacto, You did not see anything wrong, except that the setup I posted was of Silver and not Gold. XAGUSD = Silver, XAUUSD = Gold. I have the same gold analysis as you and that is why I chose Silver over Gold for shorts even though both have the same D1 speed bump supply. Silver's weekly demand is still a distance away, giving any shorts more room to run.
Your right Ivan, stupid mistake, or just in need of stronger glasses
  • #2,497
  • Sep 16, 2013 12:39am Sep 16, 2013 12:39am
Quoting Reacto
{quote} Your right Ivan, stupid mistake, or just in need of stronger glasses
Haha now my dilemma is whether to take Silver long on H1. If it was coming from HTF good demand I would take it without hesitation, but this rebound seems to be coming from the middle of no where! The similar setup can be found on Gold and we have better reason to take the long because price is coming from weekly demand.

Attached Image (click to enlarge)
Click to Enlarge Name: XAGUSD H1.png Size: 30 KB
  • #2,498
  • Sep 16, 2013 1:22am Sep 16, 2013 1:22am
Quoting Myst1z
{quote} Haha now my dilemma is whether to take Silver long on H1. If it was coming from HTF good demand I would take it without hesitation, but this rebound seems to be coming from the middle of no where! The similar setup can be found on Gold and we have better reason to take the long because price is coming from weekly demand. {image}
Price overshot the level, but the level held. This happens from time to time.

Now, I'm not 100% sure, whether the level actually held, and we should go for longs, or if it'll turn around once it hits the next lower TF supply, and we should still take shorts.


In doubt? Better to not do anything.

Hopefully Alfonso can chip into this.
  • #2,499
  • Sep 16, 2013 1:24am Sep 16, 2013 1:24am
Quoting Myst1z
{quote} Haha now my dilemma is whether to take Silver long on H1. If it was coming from HTF good demand I would take it without hesitation, but this rebound seems to be coming from the middle of no where! The similar setup can be found on Gold and we have better reason to take the long because price is coming from weekly demand. {image}
Hey there Ivan!
That SILVER long is not allowed as per the rules, you can't change direction just the long side just because there is a new H1 demand area formed and 2 small H1 supply areas have been taken out. We're not yet at higher timeframe demand areas, so longs are not allowed. If we had fell short of hitting HTF demand, yes of course we'd be allowed, but it's not the far! Lots of room to reach it, as you well said.

The D1 CP supply (continuation pattern from now on, instead of speedbump) has not yet been reached, no other shorts are possible now on H1, we need the lows to be broken to resume the H1 shorts, or the D1 supply to be hit.

That long could work, it would be the push price needs to reach D1 supply, but we're not allowed for the single fact that no HTF demand has been hit.

Hope that it makes sense!
Alfonso
Set and Forget supply and demand trading community
  • #2,500
  • Sep 16, 2013 1:24am Sep 16, 2013 1:24am
Hi Ivan, your laughing about it, but it's sadly true

The picture in D1 does not give me much reason to go long here in silver
Attached Image (click to enlarge)
Click to Enlarge Name: Image1.png Size: 90 KB
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