Supply and demand in a nutshell by Alfonso Moreno | Page 166 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #3,301
  • Oct 22, 2013 9:57am Oct 22, 2013 9:57am
I'm sorry if I missed this earlier in the thread, but how do I use the rectangle extender indicator with the insanity supply and demand indicator?

Does the S&D indicator work well at weekly and 4 hour timeframes?
  • #3,302
  • Oct 22, 2013 10:28am Oct 22, 2013 10:28am
Thank You pres78.
  • #3,303
  • Oct 22, 2013 10:34am Oct 22, 2013 10:34am
Quoting adriann
panoramia(Alfonzo): i was looking on your chart that you posted for RS2000 have a question did you also took entry on mark "A"? coz this is similar situation that you had your trade later on chart. we have nice swing formed RBR(rally based rally) breaking tops and then pullback to base market 'a' {image}
No, I didn't take that trade, not because it was not a valid trade but because I missed that one. It would have been a loss, but losses are part of the game, so I would have looked for another trade. Not all situations work, it's all about probabilities you know

Alfonso
Set and Forget supply and demand trading community
  • #3,304
  • Oct 22, 2013 10:41am Oct 22, 2013 10:41am
Quoting GregT
I am seeking advice about zone markups as I CANNOT find the answer in Alfonso's post #1. Consider the attached snippet of H4 chart that I would be using as my Execution TF Should each of these H4 zones be traded? If not, why not? {image}
Greg, it's simple, it's all on Post #1, most answers are there but you need practice and undestand what Post #1 says, simple but not easy.

  1. You are forgetting one very IMPORTANT thing, you need your curve TF in order to decide what zones are valid and which ones are not. It's clearly specified in 1st Post. If you don't do that, you will come up with these indecisions about which levels to choose
  2. None of those H4 zones would be valid! Why? The H4 Trendline would be solidly broken once price reached those areas for your long entries
  3. If one of the zones happened to be on a fresh HTF demand area, it would be validated since the TL is not taken into account when that happens
  4. BUT, since you didn't take into account the Higher TFs in your analysis, you will always have doubts as to which levels to take
  5. The Trendline rules are clearly specified in Post #1 as well so all answers still lie in Post #1

I am not saying it's simple, do not misunderstand me. But the rules are there, you didn't take into account the curve analysis nor the Trendline rules, which are clearly specified in the 1st Post.

Alfonso

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Set and Forget supply and demand trading community
  • #3,305
  • Oct 22, 2013 10:43am Oct 22, 2013 10:43am
Quoting GregT
{quote} I am OK with drawing the weekly zones and seeing where my H4 zones are in the weekly curve, but what criteria do you apply before you would trade the H4 zone? Do you wait until you see a H4 zone coinciding with a weekly zone or will you take a H4 zone that is within 30% of the weekly zone? Also, do you prefer to trade zones A and C because the momentum candles that originated from those zones actually took out the previous Higher Highs that I marked with the green lines?
Greg, both Caparzo and myself answered already to the same question in the same way. The % are described on the forum and you need your curve timeframe to make a decision.


If a TL is broken you need price to either reach a HTF area or resume the previous trend, it's all on Post #1, very explicit and clear rules! We don't trade in the middle.
Alfonso
Set and Forget supply and demand trading community
  • #3,306
  • Oct 22, 2013 10:46am Oct 22, 2013 10:46am
Quoting ConcreteWind
Alfonso, and all others in the thread, Your experience and knowledge will deeply be appreciated: PLEASE, CORRECT ANYTHING & EVERYTHING YOU SEE WRONG AND MISGUIDING FOR ALL OTHER MEMBERS SO AS TO AVOID MISCONCEPTION. APPRECIATEDTek
Sorry I can't help you on this one Tek, but your chart is overloaded with rectangles, lines and colors, I can't make out anything there! It's very unclear to me, I looked at it for 2 seconds and I was lost, so I can't tell.

Alfonso
Set and Forget supply and demand trading community
  • #3,307
  • Oct 22, 2013 11:10am Oct 22, 2013 11:10am
Dear Alfonso,

First, thank you so very much. I've followed Sam Seiden for many years but you have helped clear up many misconceptions and filled in lots of the puzzle for me. I have printed out your first post, studied it often, viewed all the current youtube videos (only the ones you just did recently) and am up to about page 20 on the thread.

One thing that I'm not clear on regards the curve. I know you've talked about this some, but I still can't get straight the following:

1) do you use speed bumps/continuation patterns on the curve TF to set up your curve or only peaks/valleys?

2) is what you call "demand in control" or "supply in control" levels the same thing as the levels used to define the curve? For example: if my curve TF is weekly, is the "demand in control" the same thing as the 0% in the curve? Or is it possible I have mistaken and "demand in control" could for instance be a CP, thus "in control" isn't necessarily the same as "the curve".

Thanks for anyone able to refine my understanding of these ideas.
  • #3,308
  • Oct 22, 2013 11:21am Oct 22, 2013 11:21am
Quoting panoramia
{quote} Greg, it's simple, it's all on Post #1, most answers are there but you need practice and undestand what Post #1 says, simple but not easy. You are forgetting one very IMPORTANT thing, you need your curve TF in order to decide what zones are valid and which ones are not. It's clearly specified in 1st Post. If you don't do that, you will come up with these indecisions about which levels to choose None of those H4 zones would be valid! Why? The H4 Trendline would be solidly broken once price reached those areas for your long entries If one...
Hi Alfonso,
As a supply and demand trader I think this CP pattern is highly dangerous unless they are into high frame like a month or weekly!
And for trade lines i think Andrew work's is better. You have on the way of this! i like it.
Regards.
Happy trading all.
  • #3,309
  • Edited 12:05pm Oct 22, 2013 11:43am | Edited 12:05pm
Quoting Ariful Mamun
{quote} Hi Alfonso, As a supply and demand trader I think this CP pattern is highly dangerous unless they are into high frame like a month or weekly! And for trade lines i think Andrew work's is better. You have on the way of this! i like it. Regards. Happy trading all.
Thanks for your comments. I just trade what I backtest Ariful. In fact CP patterns are the patterns that work the best when a new trend is starting, not at the extremes high at the WK/Monthly timeframe, just the opposite. When in those HTF zones, CPs are high probability like you said, IF, and only IF, price starts to bounce from those areas and forms CPs, not exisitng CPs when price is arriving into HTF zones, that is, new CPs forming on the reaction off HTF trades.

As for the TL's, it's not better or work than anything, I always say it. It's a mechanical way of filtering out levels and assessing trend with very fixed rules. We need rules to keep us on the right track, that's the only purpose of the TL

Happy trading to you too!
Alfonso
Set and Forget supply and demand trading community
  • #3,310
  • Oct 22, 2013 12:43pm Oct 22, 2013 12:43pm
CPs when price is arriving into HTF zones, that is, new CPs forming on the reaction off HTF trades.


Hi Alfonso,
Thanks for ur clarify about CP.My own observation is that those situations it is like work swing trading considering about support and resistance, what / how price react those level PA .But for extreme cp ur observation is very much honourable.
And finally nothing is better than trade line.I just add that Mr.Andrew's pitchfork work for me.In fact it is a channel trade line like parallal trade line.
Thanks for continuing share ur experience to us.
Regards.
  • #3,311
  • Oct 22, 2013 12:50pm Oct 22, 2013 12:50pm
Quoting panoramia
{quote} Sorry I can't help you on this one Tek, but your chart is overloaded with rectangles, lines and colors, I can't make out anything there! It's very unclear to me, I looked at it for 2 seconds and I was lost, so I can't tell. Alfonso
sorry alfonso to keep you busy,

the only diiference was that the rectangles were drawn by Insanity Industries' indicator.

will do my best to submit questions to you solely with your template.

many thanks for your time.

tek
  • #3,312
  • Oct 23, 2013 12:28pm Oct 23, 2013 12:28pm
hi guys and Mr Alfonso.


im specting to go short when price hits supply on wk.

Im having some troubles trying to pick my tf set up, i was trading using D1 curve and H4 for entryes and for the rules i have to use wk for the curve but it takes to long for me for a set up.
Alfonso, what do you suggest me to do, stick with h4 wk combo or D1 H4?

thank you.
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passion and discipline
  • #3,313
  • Oct 23, 2013 1:53pm Oct 23, 2013 1:53pm
New trader to FF, my name is Jonathan. I'm choosing this thread to take part in. Templates loaded. Thread scanned and still being read more thoroughly. Information here is wonderfully laid out. Cheers to the thread leader and participants. First trade placed on a simple triple top with a good risk reward. I plan to move to break even when price enters the first demand zone.

Thanks for all of the work here again. Look forward to trading with you.
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  • #3,314
  • Oct 23, 2013 2:21pm Oct 23, 2013 2:21pm
Third trade, perhaps forcing this one. But I've got a full 1:1 RR and a lot of response to previous support created by previous demand.
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  • #3,315
  • Oct 23, 2013 2:40pm Oct 23, 2013 2:40pm
Quoting rohule
hi guys and Mr Alfonso. im specting to go short when price hits supply on wk. Im having some troubles trying to pick my tf set up, i was trading using D1 curve and H4 for entryes and for the rules i have to use wk for the curve but it takes to long for me for a set up. Alfonso, what do you suggest me to do, stick with h4 wk combo or D1 H4? thank you. {image}
Patience is key, PATIENCE in uppercase! Patience is what prevents most traders from becoming successful. Most want to have many trades a day and they don't realize that quality is better than quantity. At the end of the month, you make the balance and see how your account is going. The H4 is a nice TF for swing trading, if you don't get many trades, track more pairs so you add more possible setups.

You can use any TF combination you want, but if you switch to another you should do it for a good reason, don't switch back and forth. Any combination can work if you have the rules but it looks like the problem here is not the TF combos, but your patience!

Alfonso
Set and Forget supply and demand trading community
  • #3,316
  • Oct 23, 2013 3:00pm Oct 23, 2013 3:00pm
Buy limit placed looking for previous resistance to become support for a good RR.
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Also, another trade, this more aggressive, still a good RR.
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All other trades in profit now for over $1k. Good day. Break evens are coming.
  • #3,317
  • Oct 23, 2013 3:19pm Oct 23, 2013 3:19pm
Idea: Place order at place of previous support or resistance, that is, supply and demand. Place your stop as usual behind most recent swing. Now! Move entry to place where your stop was placed. You're now the man on the other side of all those losing trades you entered moments too early. New stop begins and trails equidistant to previous stop placement to order, likely, and hopefully, a few pips plus spread behind a large candle that led to the areas creation.


Do you see it?

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  • #3,318
  • Oct 23, 2013 3:33pm Oct 23, 2013 3:33pm
EA to scale out automatically and manage the trailing stop and break even. Also an EA to send me an email with a screenshot of the entry and orders and an email on close or order moves. Place orders and play. Also trying the game of placing my orders where my stop would be, taking the money that I would be giving up.
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  • #3,319
  • Oct 23, 2013 3:52pm Oct 23, 2013 3:52pm
Quoting panoramia
{quote} Patience is key, PATIENCE in uppercase! Patience is what prevents most traders from becoming successful. Most want to have many trades a day and they don't realize that quality is better than quantity. At the end of the month, you make the balance and see how your account is going. The H4 is a nice TF for swing trading, if you don't get many trades, track more pairs so you add more possible setups. You can use any TF combination you want, but if you switch to another you should do it for a good reason, don't switch back and forth. Any combination...
Hi,
I think one should trade the TF suited to their risk tolerance or as dictacted by their trading capital ,the smaller TF will have smaller risk value as well as smaller profit gains but it allows one to take advantage of price imbalances as we know FX market is fractal.
  • #3,320
  • Oct 23, 2013 4:23pm Oct 23, 2013 4:23pm
Quoting Gxp1
{quote} Hi, I think one should trade the TF suited to their risk tolerance or as dictacted by their trading capital ,the smaller TF will have smaller risk value as well as smaller profit gains but it allows one to take advantage of price imbalances as we know FX market is fractal.
Yes, one has to decide the TF combo not only based on your personality but also based on the risk tolerance as you said. The thing is that no matter what timeframe combo I choose, I will always be taking the same risk, 1% on each trade. I will adapt my entry based on the pip value of that pair, width of the level and my equity and the moment of taking that trade, so risk tolerance is subjective.

The key thing here is to decide which type of trader you are, so you can choose the appropiate TF combo. But patience is key, in fact, it's better that price takes time to reach the levels, you will have more time to stay away from the computer and let the market do what it has to do


Alfonso
Set and Forget supply and demand trading community
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