Supply and demand in a nutshell by Alfonso Moreno | Page 192 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #3,821
  • Edited 3:29am Jan 16, 2014 3:15am | Edited 3:29am
The difference is probably due to server time zone, mine is GMT.
If the supply area is broken but the trend line ends up holding, what will that mean? (according to the system)
Another thing KIMIS, isn't the origin of your daily support area the previous support area below that one?
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  • #3,822
  • Jan 16, 2014 3:32am Jan 16, 2014 3:32am
I'd suggest you to use some demo of other broker to have "correct" h4/d1 candles. but not sure is that must for this method.

as for other questions I can't answer to you as I'm still learn this method. Let the masters speak.
  • #3,823
  • Jan 16, 2014 3:52am Jan 16, 2014 3:52am
Correct candles? What is your server time?
  • #3,824
  • Edited 5:52am Jan 16, 2014 4:45am | Edited 5:52am
Quoting alt11
Correct candles? What is your server time?
my h4/d1 starts at GMT+2 and that commonly considered as correct/normal/standard or what ever candles.

But in other hand Alfonso doesn't mention that on first post. maybe candle time is not so important here. but IMHO picture of H4/D1 can be absolutely different due to different candle time.
  • #3,825
  • Jan 16, 2014 7:54am Jan 16, 2014 7:54am
CHICA
Its a good question,I would rather say a RBD is found in the smaller time frame of bigger timeframe DBD.
  • #3,826
  • Jan 16, 2014 7:53pm Jan 16, 2014 7:53pm
Quoting Hrt
CHICA Its a good question,I would rather say a RBD is found in the smaller time frame of bigger timeframe DBD.
Thanks for that. Upon reflection I agree. As I prefer rbd s and dbr s at extremes of each move (historical)for potential corrections or reversals
Bye Bye FF
  • #3,827
  • Jan 19, 2014 1:58pm Jan 19, 2014 1:58pm
Here is a trade I'm proposing in the EURJPY using the Daily/1Hr combo. The reasons for the trade are as follows:
a) lots of room to fall on the Weekly and not close to any demand on the Monthly
b) Daily is in downtrend as defined by break of TL, previous demand being absorbed (orange rectangles in chart) and new supply levels being respected
c) Daily supply is in control
d) Daily HTF/curve demand level is far below
e) H1 trend is down, TL being respected and price bouncing off D1 supply
f) H1 level has good departure, little time at level, good profit margin (R/R)

Any thoughts?

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Attached Image (click to enlarge)
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  • #3,828
  • Jan 19, 2014 11:45pm Jan 19, 2014 11:45pm
Quoting Serijbok
{quote} Hi bobyv87, I'm not an expert, but I think your trade was correct. Daily trend is up (you should draw a trendline) and the D1 zone was fresh. The level on H1 was valid. So everything was fine. But did you check the usd index? As I see it is trending up on D1 TF, although the price is near to weakly supply zone. I would like to know others opinion about this trade too.
That D1 level would have been great if the imbalance would have removed the highs, but the origin of the level did not achieve that. The first retracement did but it didn't close above it and USD Index was rallying. Otherwise it would have been a perfect level.

Alfonso
Set and Forget supply and demand trading community
  • #3,829
  • Jan 19, 2014 11:49pm Jan 19, 2014 11:49pm
Quoting coolmoss
Hello Alfonso, If you see this and have a moment to comment I'd really appreciate it. The question is also in the screen shot and this is the USDSGD chart from your most recent webinar (a few weeks back). During the webinar someone thought the gray CP demand pattern produced a loss, and you pointed out that the cp demand pattern wasn't really demand because the previous high was not taken out. It had been my understanding that a new high wasn't necessary, but rather that the opposing supply was removed. I have an orange rectangle around what I'm...
Hi Coolmoss!

The CP was not validaded because it didn't remove those highs. Removing the highs is not necessary if there is ENOUGH room to next higher timeframe supply. But where price was, it didn't remove those highs on the left, which I believe was D1 supply. You don't want to buy against a non-broken HTF supply like the D1 supply or higher. IF price would have been far away from those highs, then you wouldn't need to remove it, but it was right there and it couldn't trade above it or close above it, so the CP pattern of demand would not be validated.


Hope that makes sense.
Alfonso
Set and Forget supply and demand trading community
  • #3,830
  • Jan 19, 2014 11:51pm Jan 19, 2014 11:51pm
Quoting Carousel46
{quote} Hi Alfonso, I am studying the thread from the very beginning and I just hit this nice post of yours. The new original H4 supply at the D1 SZ proximal line did not absorb any demand below and yet you would short the first reaction. In one of the posts you stated that there is an exception to the rule which says that: Price needs to remove opposing SD level to validate previous one, but sometimes it does not need to: 1) At fresh and original HTF zone2) When there is no opposing SD zone to remove with long ERC candles on the left Is this the...
Hi there!
If the higher timeframe supply (let's say it's a D1 supply) is fresh and original, so you are trading with the trend, you don't need to wait for the opposing demand to be removed. If the D1 supply is not fresh but it's still with in a trend, then you wait for confirmation and wait either for a) previous demand to be removed or b) valid ascending H4 TL to be solidly broken.

Hope that makes sense to you.
Alfonso
Set and Forget supply and demand trading community
  • #3,831
  • Jan 19, 2014 11:55pm Jan 19, 2014 11:55pm
Quoting Chica
Hi All Great thread, Sometimes I have actual problems with Identfying a cont pattern from a small peak or valley, PLease see below (this is just for demonstartion purposes and the levels may not be actual great levels, but rather looking for ssome hints to work out exactly how to determine if its a speedbump or a small peak valley). Any assistance would be appreciated because I can currently see it as both? Thanks in advance, {image} {image}
That is a rally-base-drop, not a CP pattern. CP patterns have to have a clear drop and a clear base. So the one you drew is not a CP pattern. You should try to look at the charts and collect a dozen of valid CP patterns that have been mentioned and get a feeling of how they should look like.

Alfonso
Set and Forget supply and demand trading community
  • #3,832
  • Jan 19, 2014 11:58pm Jan 19, 2014 11:58pm
Quoting lobogabor
Hi Guyz, Could anybody PM me the removed secret material for How to draw SD zones, or similar with the rules from Seiden or Alfonso? Thanks a lot.
There is no secret material I didn't invent anything, I just created videos to show how I personally draw SD levels. There are several ways, taking the wicks, only the bodies of the basing candles. If you want my webinars you will see how I do it. I learnt it from free videos and information available out there on the internet on that matter, most are free videos by Sam Seiden webinars. Then I added certain nuances with trendlines, and rules on basing candles, that's all. Nothing is secret, it's out there if you, and can be easily tested if you have the time.

Alfonso
Set and Forget supply and demand trading community
  • #3,833
  • Jan 20, 2014 12:01am Jan 20, 2014 12:01am
Quoting GregT
Here is my zone analysis on AUDUSD Monthly chart. Does anyone think it is flawed? If so, I would appreciate your critique {image}
I agree with your analysis Greg. I am a bit late in my answer because I've been away on holidays. Now the AUDUSD has removed MN CP pattern of demand and might present some nice H4 supply zones to short at in the direction of the fresh MN demand zone you drew.

Alfonso
Set and Forget supply and demand trading community
  • #3,834
  • Jan 20, 2014 12:04am Jan 20, 2014 12:04am
Quoting GregT
{quote} My opinion about your zone and trade is shown in the attached image. You might also like to look at information that is slowly being collected at http://groups.google.com/d/forum/sup...nd-FAQ-Alfonso {image}
Yes, the zone was not 100% correctly drawn. The thing is: do you want to trade against the Higher Timeframe trends? MN and D1? I don't... If you do be aware of the possible consequences and also that you have to manage your SL more aggressively as well as your take profits, do not expect a runner.

I didn't take that supply zone, I was waiting for a long entry on the D1 demand.
Alfonso
Set and Forget supply and demand trading community
  • #3,835
  • Jan 20, 2014 12:08am Jan 20, 2014 12:08am
Quoting isharasjc
Hi Alfonso, Im reading your first post and its great, found lot of valueble info and thanx for the effort. In one place I saw you are mentioning multiple timeframe analysis with four times greater for the next time-frame and your example is 1H, 4H and D1 time-frames, which I totally understand. But in Swing-trading, Position-trading and Intraday-trading configurations the time-frames you have mentioned is different. So Im bit confused now and expecting a help to understand the mentioned portion. Thanx in Advance, Ishara
Hi there!

It normally is 4-5 times greater but in some cases like the MN/D1 combination is not like that. It's a common combination used. D1 is used a lot by the institutions as well as the Monthly. I've tested that combo a lot and it works great. In the lower timeframes it's easier to find the 4-5 ratio, but not on the bigger timeframes. It just works like that, do your backtesting and you will see by yourself, don't believe me. Been using those combos for a long time and they just work. Any combo will work really if you have the appropiate rules.

Alfonso
Set and Forget supply and demand trading community
  • #3,836
  • Edited 3:37am Jan 20, 2014 12:10am | Edited 3:37am
Quoting kimis
I'd suggest you to use some demo of other broker to have "correct" h4/d1 candles. but not sure is that must for this method. as for other questions I can't answer to you as I'm still learn this method. Let the masters speak.
Each broker has different GMT so candles differ from one to another. I've always said the same thing... Trade what you see on your charts. On my chart I may have a valid entry but on another broker the level is not there or it looks awful. The opposite may be happen to me.... Just trade what you see, if you start comparing with other brokers then you will just get confused. If worried about candle formation, then Futures should be the right thing to do, the candles will be the same on all brokers

GMT offset does not affect the methodology for this reason, you just trade what you see as if your broker's candle formations were the only ones.

Alfonso
Set and Forget supply and demand trading community
  • #3,837
  • Jan 20, 2014 5:08am Jan 20, 2014 5:08am
Hello fellow traders!

I'm back from my holidays in Vietnam and going back to my daily routine. I had a great time there, I also traded while I was away since the methodology allows me to do that.

  1. DATE: Monday 27th January 2014
  2. TIME: 1 PM to 2:30 P.M Central European Time | 7 a.m to 8:30 a.m EST. Right 1 hour before NY Market Open

What will we cover on this webinar?

  1. Trading with the trend and with higher timeframe's direction
  2. Questions and answers

If you have previously joined one of my free webinars, you don't need to do anything since you will receive an email with the link to join.

If you haven't joined any webinars before, you will have to fill out this form: http://www.set-and-forget.com/free_webinars

Once you do that, in the last email for email address confirmation you will get the link to join the webinar.
Hope to see you there.

Have a great day!
Alfonso

www.set-and-forget.com

Set and Forget supply and demand trading community
  • #3,838
  • Jan 20, 2014 7:27am Jan 20, 2014 7:27am
Has anyone backtested whether or not it would make sense to additionally look at Pivot Point, in the context of supply & demand set & forget trading?
I mean a classic pivot point, i.e. the average of close, high, low.

For example, look at a higher timeframe pivot point and trade H1 long only, if the price is above D1 pivot point. Trade H1 short if the price is below D1 pivot. This would be just another trend indicator for higher TF. Or maybe there is some other way... Or maybe we should look the other way, because SD trading is counter-trend at a lower TF, trade long below the H1 pivot?

I am wondering and would be happy to hear from you.

If it does not make sense for example, I will save time on analysis.
If it does, I will need to do homework anyway, then prepare setups catalogue, then demo, then live micro... and maybe this will help others, too :-)
Michal9
  • #3,839
  • Jan 20, 2014 9:12am Jan 20, 2014 9:12am
Quoting coolmoss
Here is a trade I'm proposing in the EURJPY using the Daily/1Hr combo. The reasons for the trade are as follows: a) lots of room to fall on the Weekly and not close to any demand on the Monthly b) Daily is in downtrend as defined by break of TL, previous demand being absorbed (orange rectangles in chart) and new supply levels being respected c) Daily supply is in control d) Daily HTF/curve demand level is far below e) H1 trend is down, TL being respected and price bouncing off D1 supply f) H1 level has good departure, little time at level, good...
Hi Coolmoss,

I'm not sure, but I think your daily trendline is too strict, because it was drawn through CP patterns and not through obvious valleys. As I see the trendline was not broken on D1 if it is drawn trough valleys. The trend is up on Mn as the last SZ was broken. The downtrend is nice on H1 and as I see your plan is working, but you have to be carefully, because of higher TF-s trend.
  • #3,840
  • Jan 20, 2014 3:55pm Jan 20, 2014 3:55pm
Hi, whey you choose a combo to trade, e.g. weekly/H4, do you also draw all the levels on monthly and daily?
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