Supply and demand in a nutshell by Alfonso Moreno

Hi Alfonso,

Thanks a whole lot for the great job that you've done with this thread! I have studied your materials with enthusiasm.

Here is an idea for a Gbp/Aud trade, which I believe complies with all the rules and requirements.

The idea would be to go long off the H4 level right around 1.7872.
Reasons being:

1)Uptrend on Daily and Weekly with Valid TL's.
2)Best position in Weekly Curve.
3)Fresh level on H4 with Excellent Departure.
4)RR works out.

Any feedback would be appreciated.

Thanks again for all your awesome work!

-Steve

Hello Alfonso,

I am understand that once in a trade, one can use moving average, trend line, technical stop, trailing stop or ballistic exit in order to let the trade run and maximise profit. Which of these methods will you recommend in order to ensure that one locks in the highest amount of profits before the current trend reverses?

Regards,

Jamaa

Hello Jamaa,
All information on when/how to exit a trade is on Post #1. It's up to each trader to decide which one to apply on each scenario, a fix one or different ones. You will have to watch the charts and decide which one to apply on each circumstance, it all depends on what the market is doing, ranging, trending, too high. The different options (there are more obviously) are on Post #1. But whatever you do, do always the same under the same scenarios or there will be no consistency.

Cheers,
Alfonso

Thanks for your kind words and sharing your views on GBP / AUD Steve, much appreciated. There is definetely a lot of buyers down there at that H4 demand you pointed out down at the extreme. There is one D1 demand above that H4 demand that could also produce some reaction but there is a lot of trading in that zone, we'd need to wait for confirmation in order to go long.

Thanks again for your support!
Alfonso

Thanks very much for your input. I did also notice the level at D1, but thought there is tighter risk on H4.

Of course you're right about the trading in the zone.

I'll keep studying and practicing!

Hello Alfonso,

Thanks for your response. Grateful if you will shed some light on the ballistic exit strategy.

Best regards,

Jamaa

Being brilliant every single day
The quality of your thoughts is highly influenced by your biology

Hello fellow traders!

This post may seem that it has nothing to do with trading, but it DOES.Controlling your emotions, thinking and body is key to have success in life, trading is not an exception, in fact it's key to trading.

I've transcribed part of what Dr. Alan Atkins says in a 2 parts video (links at the end of this post). This is a must see video, hopefully you will love it as much as I did, they are very funny as well

We have to change emotions in order change our feelings so we can change how we think and how we behave

1. Results and performance
2. Behavior
3. Thinking
4. Feelings
5. Emotions
6. Physiology (streams of data)

https://gallery.mailchimp.com/5c569e...8cb34c074d.jpg

Aren't feelings and emotions the same stuff? It's not. In fact many people don't even realize that feeling and thinking are not the same thing, particularly men

If you want to change your results by changing the behavior, there are multiple levels to deal with. And even if you get to grips with the emotions, it's still not enough because there is something even more fundamental in our human existence, it's our physiology.

Physiology is just data stream coming into our brain about what is going on on our body.

What is an emotion? If we take all this stream of data from our guts, joints, heart, lungs, it all comes into your brain and electro signals, chemical signals, etc. An emotion is simply energy, E-motion. We've all got emotions because every day we're constantly having that stream of data coming from various areas of our physiology.

What is a feeling? The awareness of an emotion. But we may all not have feelings. Feelings of the awareness in our mind of that energy. The energy may be there but we just don't feel it.

If you are not feeling then it's altering your thinking or how well you are thinking, which is changing what you are doing. But you don't realize that because you are feeling right, you are not feeling any of that. You are thinking what you are thinking and you are doing what you are doing.

We need to tune in with what is happening at the physiological level and not only become aware of that but have control of it. Most of us don't have control at that level, in fact many few people have control of any of these steps above.

Under pressure --> physiological chaos --> brain shutdown. We are designed that way.

Why are we designed that way? Survival advantages. Unsophisticated binary thinking or we'll be dead. Sophisticated reaction will kill us. We have a 2.000 years old software in our brain and we've never had an upgrade.

If we can have control of the whole thing we can crank out our game every single day. Our own anxiety is causing the chaos so we lobotomize our brain and say and do crappy things.

The quality of our thoughts is highly influenced by our biology.

We think. But why do we think and what do we think? The very things that we think, and how well you think them, will depend a lot on the biology.

If we wanna double or triple our quality of our thinking, we can't do it by thinking. You can't solve a problem with the same level of thinking. How do we get to a new level of thinking? We don't get to a new level of thinking just by thinking about it. You've got to change the context in which thought emerge.

How do we get our physiology under control? It's by doing something you can get conscious control over, we can do that with our breathing. There are 12 different aspects of our breath that we can't control. The single most important thing is rhythm (level of coherence). If we start to control the rhythm of the breath, that will start to change the physiology, you will start being more coherent and your frontal lobe will work better. We are simply sending better fuel from the heart to the brain and the brain will work better. And when the brain works better, you are more perceptive, more insightful, you have more clear thinking, you can understand how the problem is solved.

Take a few rhythmic breaths versus take a deep breath. Rhythm is far more important than large/deep breaths, a rhythm breath (fix ratio) will start changing your physiology, a deep one will not.

The second most important feature is smoothness. Fix volume per second round the entire cycle. Smoothness gives us the most powerful effect.

Location of your attention while you are breathing. Breath through the center of your chest (heart area) because it generates more electrical power than any other area in your body.

BREATHE. Breath Rhythmically Evenly And Through The Heart Everyday

Part 1:

Part 2:


Have a great day!
Alfonso

1. US index WK demand is in control, brand new D1 demand printed on the charts. Longs is the way to go on US index, this will affect the eurusd, short bias on EURUSD

I also see some Weekly level bullish confluence on the Eur/Usd, in the area of the lower ascending TL, with the relatively low print area towards the bottom of supply. This also shows up on the Daily.

Should be interesting!

Hi to everybody, i have a question for Alfonso:
Dear Alfonso please, take a look the picture below and tell me if my thought in the ellipse can be correct....
Thanks a lot

No, there is no possibility to draw a level on the ellipse area, it's not a well formed/structure supply zone, lot of wicks and tails, not a solid tight CP supply. Price could react to it though, so only confirmation would be allowed for shorts if you ever wanted to try a short there.

Besides the way you drew it is incorrect, in order to draw a level we need a base. You just took part of the upper wick, nothing else, that goes against the rules.

Hope it makes sense!
Alfonso

Ok Alfonso, it makes sense thanx a lot!

Alfonso, new member from Canada on Forexfactory, so first of all I wanted to sincerely thank you for all time and efforts you have put into teaching us about supply and demand trading. I have read (alot but not all!) of your posts and I really appreciate your teaching methods.

I found you by accident while looking for a supply and demand indicator for meta trader, so thankfully I am now using your rectangle reader; works well for me and has enabled me to easily and clearly identify s/d zones and to find current price in the s/d curve.

I am not sure if I have my settings wrong because the automatic trend-lines don't seem to work. Is there anywhere in your threads where you particularly talk about the trend-lines and how they are supposed to work in the rectangle reader?

thanks again and keep up your excellent work.

HI Alfonso,

I am Om,
I am learning trading since almost last 2 years now, just came accross your forum recently and I found it very useful and interesting,
I would like to share my strategy and I would like to know how exactly can I merge Your strategy with that of mine.

I use 3 EMA's 8,13 and 50, if 8 and 13 are above 50 then I consider it as a Buy Trend if below 50 then I consider it as a Sell trend and I check timeframes which are 1/4 eg: 15 Mins, 1 Hrs, 4 Hrs and Daily OR Monthly weekly daily and 4 Hrs.
I enter a trade only when I have a same trend in all the 4 Timeframes; as soon as I see 8 and 13 crossover in the shortest timeframe I exit.
I am able to make profit by using this, I get the correct entry but I am unable to find out the correct way of exit.

Now after coming across your strategy of price action I first find out the trend as per EMA's and enter and exit as per price action only in the direction of the trend

Now with your strategy i am able to determine both entry and exit.

But I would like to know your perception.

Thanks a ton for sharing your knowledge.

Thanks for your message and compliments, much appreaciated my friend.

I don't know if I understood you well. All levels have to be drawn manually in order to be captured and extended by the Rectangle Reader indicator. Then it will draw a horizontal truncated trendline above and below the rectangle you drew, that's automatic and should always work, unless you are referring to something else.

The visualization of the trendlines and timeframes where they are going to be drawn automatically can be controlled by the _trendlines and lines_numbers settings for each TF available on MT, you can see it in the attachment. They are set to true by default so they should work, if there don't there must be something wrong? What? Maybe indicator ACTIVE variable is set to false. Never heard it's not drawing trendlines on rectangles.

Then there is an automatic SD zones indicator, the rectangle reader WILL NOT add trendlines to the rectangles automatically generated, ONLY to those that have been drawn manually, the automatic ones will be ignored. So maybe that's the problem.

Hope that helped!
Alfonso

Hi panora, what a nice thread you have here. i love S/D zones but am using in option trading i must say that you are a pro in this strategy. Good work bro

i wanted to download the video you uploaded in page 8 but it seems not working, please i would like to get the download links from you. thanks and keep the good work flowing.

Hello my friend!
Thanks for your kind words and comments, much appreciated. Some of the videos are not longer available, they were removed. The only ones available now can be found on the YouTube channel, there are quite a lot there available for everybody. If that one you are referring to is not available, I'm sure one of the other videos will cover the topics on the missing one.

Hope that helps.
Alfonso

Hello Alfonso,
i think i understand more every day (hopefully), but i'm still learning. So i got a new question. Please watch the chart, its countertrend (against curve timeframe trend) = less edge, but was the last demand i draw valid? so 2 countertrend trades is 1 too many? curve demand was not fresh but entry demand take out entry supply. Is it just a loss or is it my mistake in the market view?

Thanks,
Joe

Hello Joe,

What can I say about that screenshot? First and foremost... Are you successful and profitable trading WITH the trend? If not, why are you trying to counter-trend? Just asking... Sometimes us human beings want to be in control of everything, we want to trade sideways, counter-trend, with the trend, whereas what we should do is find the highest probability trade WITH the trend and forget about counter-trend which has less profit potential and lower odds. Once you are successful trading with the trend you can try to add counter-trend, but then ask yourself... why if I am already profitable trend trading should I counter-trend?

Having said that, I can't really tell you by looking at that screenshot. Multiple timeframe analysis is needed, seeing the base formation of those levels and son on. In principle I would not try the second one. Why? When a demand level is not fresh, price will tend to penetrate it lower (the blank areas that have "unfilled" orders), so whatever you do in such a level, wait for price to penetrate lower within the curve TF and wait for a brand new imbalance that removes opposing supply and breaks that the TF descending trendline in this case...

But like I said, very difficult to say without multiple charts, candle formations, etc. I would not go counter-trend in such a case, I would switch to another pair, there are 60+ currency pairs, then indexes, etc. I will just not bother about it and look for a clear setup.

Alfonso

Thanks alfonso,
I probably want to be in control of everything, my mistake. I will skip countertrend and focus on withtrend. See you next time

Joe