Supply and demand in a nutshell by Alfonso Moreno | Page 301 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #6,001
  • Sep 4, 2015 5:43am Sep 4, 2015 5:43am
Quoting Chawl
{quote} I have the same analysis and I'll try to short EURJPY somewhere convenient next week but we are in a huge daily demand in control that you might have missed in your analysis, though it won't affect my shorting plan as half of it is already consumed through south. Hope Alfonso might comment on these. {image}
That D1 demand you drew with a huge 50% candle is not demand, it's just a failed ERC bullish candle. If you draw zones on candles like that then you will see a zone on EVERY candle.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,002
  • Sep 4, 2015 5:44am Sep 4, 2015 5:44am
Quoting John.
Chawl, thanks for charts. They really differ from my broker. ============== EURJPY - it seems that the next week may give us good chances to go short? WK DZ is broken out. WK is down now and supply in control. If WK will close below this broken DZ we will have plenty of room down. {image} {image} {image}
Shorts shorts we go my captain
Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,003
  • Sep 4, 2015 5:45am Sep 4, 2015 5:45am
Quoting Baifo
{quote} Thanks for your answer! P.S. Yes, I'm from from Tenerife, that's a expression we use here in Canary islands "se me fue el baifo".
I visit Tenerife island very often, contact me on private at www.set-and-forget.com, maybe we can meet live next time I go to the island this month.
Un saludo de alguien al que aśn no se le fue el baifo
Alfonso
Set and Forget supply and demand trading community
  • #6,004
  • Sep 4, 2015 5:48am Sep 4, 2015 5:48am
Quoting panoramia
{quote} I've been doing this for quite some time, I just have a little bit more of experience than you, that's all, I'm not smarter or better than you or anybody else, there is only the variable of time, commitment and not giving up. I don't show my trades over here now because I'm doing it in the community where they are planned ahead of time as the Brent and other potential trades in other posts. Trading H4 imbalances on 30+ currencies and just getting 4-5 trades per month is normal if you don't have the experience. The same thing happens to many...
I think you've taken green zone as a CP but not a valley, haven't you? Because if it had been a valley, H4 trend line would prevent us to trade there.
Trade what you see..
  • #6,005
  • Sep 4, 2015 5:51am Sep 4, 2015 5:51am
Quoting panoramia
{quote} That D1 demand you drew with a huge 50% candle is not demand, it's just a failed ERC bullish candle. If you draw zones on candles like that then you will see a zone on EVERY candle. Cheers, Alfonso
Aha, thank you for clearing this, because generally I've been quite sceptic about these freaks
Trade what you see..
  • #6,006
  • Sep 4, 2015 5:58am Sep 4, 2015 5:58am
Quoting Chawl
{quote} I think you've taken green zone as a CP but not a valley, haven't you? Because if it had been a valley, H4 trend line would prevent us to trade there.
Trend was down and Trendline being respected by connecting latest two peaks. Also that H4 supply imbalance took out a higher timeframe demand zone, bigger than its own, giving it even more odds. A zone that takes out an opposing imbalance bigger than its own timeframe is scored higher and has higher odds.Hope it makes senseCheers,Alfonso
Set and Forget supply and demand trading community
  • #6,007
  • Sep 4, 2015 6:00am Sep 4, 2015 6:00am
Quoting Chawl
{quote} Aha, thank you for clearing this, because generally I've been quite sceptic about these freaks
Not all 50% candles are bases or zones and some not 50% candles are zones like marubozu type of levels for continuation patterns. Never use a single basing candle that huge as a zone, it's just an erc candle that failed to become erc closing at the top of the candle range. Hope it makes sense my friend.Cheers,Alfonso
Set and Forget supply and demand trading community
  • #6,008
  • Edited 6:15am Sep 4, 2015 6:05am | Edited 6:15am
Quoting panoramia
{quote} Trend was down and Trendline being respected by connecting latest two peaks. Also that H4 supply imbalance took out a higher timeframe demand zone, bigger than its own, giving it even more odds. A zone that takes out an opposing imbalance bigger than its own timeframe is scored higher and has higher odds.Hope it makes senseCheers,Alfonso
Quoting panoramia
{quote} Not all 50% candles are bases or zones and some not 50% candles are zones like marubozu type of levels for continuation patterns. Never use a single basing candle that huge as a zone, it's just an erc candle that failed to become erc closing at the top of the candle range. Hope it makes sense my friend.Cheers,Alfonso
I've meant peaks, my bad, sorry for confusion. Both make perfect sense, thank you very much
Trade what you see..
  • #6,009
  • Sep 4, 2015 6:17am Sep 4, 2015 6:17am
Quoting panoramia
{quote} Find attached one of the latest trades I took, it is an update of a planned trade as of this morning, it was a H4 short on AUD/CAD. A few took it as well, maybe you can now look into that currency and see the reasons why it was taken and give me some feedback if you don't understand why it was taken. Cheers, Alfonso {image}
That's great, thank you!
I did not take this trade due to many reasons
1. MN - demand in control, very low in the curve
2. WK - demand in control, very low in the curve
3. Daily - demand in control
4. H4 - price bounced from H4 demand zone but we want no opposing zone ahead and we do not have 3:1 free room to opposing zone.
So in general bigger picture was not with us because all opposing HTF zones were in control and our entry chart was not so good as it should be - no free room to drop and price bounced from opposing zone.
But why did you take that zone?
Attached Image (click to enlarge)
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  • #6,010
  • Sep 4, 2015 6:36am Sep 4, 2015 6:36am
Quoting John.
{quote} That's great, thank you! I did not take this trade due to many reasons 1. MN - demand in control, very low in the curve 2. WK - demand in control, very low in the curve 3. Daily - demand in control 4. H4 - price bounced from H4 demand zone but we want no opposing zone ahead and we do not have 3:1 free room to opposing zone. So in general bigger picture was not with us because all opposing HTF zones were in control and our entry chart was not so good as it should be - no free room to drop and price bounced from opposing zone. But why did...
If previous 50% candle isn't a base but ERC, then H4 zone is (quite) original also.
Edit: Quite means, I'm sceptic again
Trade what you see..
  • #6,011
  • Edited 7:59am Sep 4, 2015 6:50am | Edited 7:59am
And the last one from me for today.
EURSEK H4 momentum short
WK/D/H4 are down
No opposing zone in control
H4 is good quality supply, good base, good departure, removed opposing DZ and has free room to opposing demand.
A couple of questions:
1) I'm afraid that price will not reach the zone but bounce from last week lows...
2) I'm afraid that H4 TL will be broken before we enter the trade and we will have to cancel it?
Attached Image (click to enlarge)
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Attached Image (click to enlarge)
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Updated: D TL is not drawn correctly (the last one is not a peak) but trend is down because 2 DZ had been broken out.
  • #6,012
  • Sep 4, 2015 7:16am Sep 4, 2015 7:16am
Quoting John.
And the last one from me for today. EURSEK H4 momentum short WK/D/H4 are down No opposing zone in control H4 is good quality supply, good base, good departure, removed opposing DZ and has free room to opposing demand. A couple of questions: 1) I'm afraid that price will not reach the zone but bounce from last week lows... 2) I'm afraid that H4 TL will be broken before we enter the trade and we will have to cancel it? {image} {image} {image}
I'm not sure if we are all shorts on EURSEK but longs istead.
M-Long
W-Long
D-(technically) long as last bar is open, previous touches the trend line and price reacting to a daily demand.
Attached Image(s) (click to enlarge)
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Trade what you see..
  • #6,013
  • Sep 4, 2015 7:52am Sep 4, 2015 7:52am
Quoting Chawl
{quote} I'm not sure if we are all shorts on EURSEK but longs istead. M-Long W-Long D-(technically) long as last bar is open, previous touches the trend line and price reacting to a daily demand. {image} {image} {image}
Your weekly chart differs from mine as you can see. WK descending TL is not broken on mine one. And price is reacting from WK SZ which is in control.
Daily is down. Your D DZ is CP which is against trend so it can not be in control. D supply still in control.
  • #6,014
  • Sep 4, 2015 8:03am Sep 4, 2015 8:03am
Quoting John.
{quote} Your weekly chart differs from mine as you can see. WK descending TL is not broken on mine one. And price is reacting from WK SZ which is in control. Daily is down. Your D DZ is CP which is against trend so it can not be in control. D supply still in control.
Our weekly charts are same but my trend lines are different, I drew them according to valleys that made higher highs. My daily demand is in a weekly demand, and as I've said, I think daily is technically long for now (at least till end of today), so nothing against trend according to my analysis. We'll see what will be though.
Edit: Please don't take into account the dashed line on weekly chart, its just a guide, not a legit trend line that I've drawn. My trend line is the solid one below.
Trade what you see..
  • #6,015
  • Sep 4, 2015 8:10am Sep 4, 2015 8:10am
Quoting Chawl
{quote} Our weekly charts are same but my trend lines are different, I drew them according to valleys that made higher highs. My daily demand is in a weekly demand, and as I've said, I think daily is technically long for now (at least till end of today), so nothing against trend according to my analysis. We'll see what will be though.
They are absolutely different
Attached Image (click to enlarge)
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  • #6,016
  • Sep 4, 2015 8:15am Sep 4, 2015 8:15am
Quoting John.
{quote} They are absolutely different {image}
Indeed yes, they are different Sorry, my bad but sure one of us has to change his broker, how feeds differ is insane and I've added a note to my previous message.
Trade what you see..
  • #6,017
  • Sep 4, 2015 8:20am Sep 4, 2015 8:20am
Quoting Chawl
{quote} ...sure one of us has to change his broker, how feeds differ is insane
That's true
  • #6,018
  • Edited 8:51am Sep 4, 2015 8:28am | Edited 8:51am
Hi Alfonso,

When on the daily the price is moving up from a "potential" demand zone and crossing a supply zone (it makes the demand zone on the daily valid), can we trade H4 demand zones created along the path of the up move or do we have to wait for a pullback to a daily demand zone or wait for a new daily demand zone to be created?

Can we trade H4 supply zones if the H4 trendline is broken?

What I don't understand is the following scenario:

On the daily, price is breaking upwards through a supply zone, then a potential demand zone becomes now valid. Depending on the case, this breakout can appear at the very beginning of the up move. If price is above the broken supply zone, can we trade demand zones on H4?



Cheers,
Daniel
Attached Image (click to enlarge)
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  • #6,019
  • Sep 4, 2015 8:36am Sep 4, 2015 8:36am
Quoting John.
{quote} That's great, thank you! I did not take this trade due to many reasons 1. MN - demand in control, very low in the curve 2. WK - demand in control, very low in the curve 3. Daily - demand in control 4. H4 - price bounced from H4 demand zone but we want no opposing zone ahead and we do not have 3:1 free room to opposing zone. So in general bigger picture was not with us because all opposing HTF zones were in control and our entry chart was not so good as it should be - no free room to drop and price bounced from opposing zone. But why did...
Hi John,

That monthly demand you drew is NOT demand. Why? A monthly demand zone needs to take out an opposing monthly supply zone or break a monthly descending trendline in order to be considered demand. If you take a look at your monthly chart, neither happened!

You were not following the core rules, it's a common mistake to consider a strong rally in price a demand zone.

Hope that it sense when you look at the monthly demand with these 2 core rules in mind.
Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,020
  • Sep 4, 2015 8:37am Sep 4, 2015 8:37am
Quoting Chawl
{quote} If previous 50% candle isn't a base but ERC, then H4 zone is (quite) original also. Edit: Quite means, I'm sceptic again
Scepticism makes you no good in life in general What is the problem now? May I know?

Cheers,
Alfonso
Set and Forget supply and demand trading community
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