Supply and demand in a nutshell by Alfonso Moreno | Page 314 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #6,261
  • Sep 28, 2015 1:13am Sep 28, 2015 1:13am
Quoting Sants
{quote} Hi alfonsoSorry if my question is unclear. Let me try to explain it again 1. We know there're 2 types of zone: a potential zone and a valid tradeable zone. -Potential zone is a zone that just created under imbalances structure like cp and peak valley and thats it. Whenever we met imbalances we can create a potential zone-valid and tradeable zone is a potential zone which violate the opposong zone or break TL.Yes i know the rules for a potential demand zone created by imbalances structure like cp or peak and valley could be valid and tradeable...
The potential zone will be valid if a valid/confirmed zone has been taken out, not just a "potential opposing" zone. I took that for granted since it's logical. If a zone is potential unless it takes out an valid/confirmed opposing imbalance, the same logic should apply to the opposing zone... that is, an opposing zone should have been a valid imbalance before being considered a zone, shouldn't it?

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,262
  • Sep 28, 2015 2:54am Sep 28, 2015 2:54am
Quoting panoramia
{quote} The potential zone will be valid if a valid/confirmed zone has been taken out, not just a "potential opposing" zone. I took that for granted since it's logical. If a zone is potential unless it takes out an valid/confirmed opposing imbalance, the same logic should apply to the opposing zone... that is, an opposing zone should have been a valid imbalance before being considered a zone, shouldn't it? Cheers, Alfonso
Thats exactly my point and for confirmation,(1) is the potential demand levels after the ascending trendline is formed will be automatically valid? (2) the second valley which connect the trendline will be invalid after the trendline break right? How about the first valley, is the zone still valid or invalid too as the second valley
  • #6,263
  • Sep 28, 2015 4:30am Sep 28, 2015 4:30am
Sorry for writing again, but since I'm a new member, my posts are reviewed and it took a long time this weekend.

If someone could just put a comment on my analysis on the GBPJPY: http://www.forexfactory.com/showthre...76#post8510276
  • #6,264
  • Sep 28, 2015 4:40am Sep 28, 2015 4:40am
Quoting Sants
{quote} Thats exactly my point and for confirmation,(1) is the potential demand levels after the ascending trendline is formed will be automatically valid? (2) the second valley which connect the trendline will be invalid after the trendline break right? How about the first valley, is the zone still valid or invalid too as the second valley
I think you are sort of complicating things a bit. Those are the two rules, nothing else my friend. Then a zone needs to make 2:1 imbalance and consolidate away with a full OHCL. It's MUCH better IF you upload some charts, so much text is confusing for both you and me, and any other reading you.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,265
  • Sep 28, 2015 7:52am Sep 28, 2015 7:52am
Quoting panoramia
{quote} It's MUCH better IF you upload some charts, so much text is confusing for both you and me, and any other reading you. Cheers, Alfonso
That's right, I read to learn the strategy of supply and demand. But when you ask questions, without charts, it is difficult to understand . Especially when English is not the native language. (Sorry for my bad english)
  • #6,266
  • Sep 28, 2015 8:05am Sep 28, 2015 8:05am
Quoting panoramia
{quote} The strategy works on any timeframe combination. Just a warning, make it work on a monthly/weekly/daily combination for quite a few months, and ONLY then switch to lower timeframes, practice for quite a few more months on lower timeframes before you go live. Just a warning, the lower the timeframe the more levels you will locate, the more losses you will have and the more experienced as a trader you will need to be. Not only on supply on demand but on any strategy, the faster the car you drive the higher the likelihood of having an accident....
I understand thank you. You are a great mentor. I am watching your SD videos and it is very explained in details. It is hard, but if it is hard to learn you know it is worth it and it works.
  • #6,267
  • Sep 28, 2015 10:05am Sep 28, 2015 10:05am
I've subscribed in your website for an rectangular indicator but never received anything?
  • #6,268
  • Sep 28, 2015 7:31pm Sep 28, 2015 7:31pm
Quoting Techanalyst
I've subscribed in your website for an rectangular indicator but never received anything?
Check your spam folder my friend, people is receiving it. You will receive several emails to confirm registration, you need to confirm email, double opt-in process, probably emails are on your spam folder. Else, contact me in private by sending me an email at Set and Forget site.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,269
  • Edited 8:07pm Sep 28, 2015 7:51pm | Edited 8:07pm
Quoting panoramia
{quote} I think you are sort of complicating things a bit. Those are the two rules, nothing else my friend. Then a zone needs to make 2:1 imbalance and consolidate away with a full OHCL. It's MUCH better IF you upload some charts, so much text is confusing for both you and me, and any other reading you. Cheers, Alfonso
Hi alfonso
Here's the chart i mean. below is GBPUSD in Daily chart. May you correct me if im wrong
(1) The trendline connecting valley1 and valley2 is valid right? and its broke after there's a candle that has OHLC below the trendline. (Valley1 demand zone is valid due to removal previous descending trendline). Hence, valley2 demand zone is no longer valid and tradeable. How about the valley1 demand zone? is it invalid too or its still valid?

(2) after the breaking the first trendline, price makes another valley (valley 3). are we allowed to draw a trendline connecting the valley 2 and valley3? as per the rules says 2 obvious valleys for trendline. but the valley 2 demand zone is no longer valid because of (1) condition (ascending trendline broke). Alternatively, can we draw the trendline connecting valley1 and valley3?

(3) and the previous quoted image, may i know when the CP supply is considered as valid level? is it because due to trendline?

Sants
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: Screenshot2.png Size: 66 KB
Click to Enlarge Name: cp.png Size: 224 KB
  • #6,270
  • Sep 28, 2015 10:18pm Sep 28, 2015 10:18pm
EURUSD Daily. These levels look good or no? Let me know thanks.
Attached Image (click to enlarge)
Click to Enlarge Name: EURUSDDaily.png Size: 75 KB
  • #6,271
  • Sep 29, 2015 2:17am Sep 29, 2015 2:17am
Quoting Techanalyst
EURUSD Daily. These levels look good or no? Let me know thanks. {image}
That supply is not well drawn as per the rules, you are breaking the rules, not covering the highest highs.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,272
  • Sep 29, 2015 6:30am Sep 29, 2015 6:30am
Quoting panoramia
{quote} That supply is not well drawn as per the rules, you are breaking the rules, not covering the highest highs. Cheers, Alfonso
Hi Alfonso,

levels in H4 EURUSD is good or no to go short?

thanks
Rio.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 35 KB
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  • #6,273
  • Sep 29, 2015 8:30am Sep 29, 2015 8:30am
Quoting rio cyrano
{quote} Hi Alfonso, levels in H4 EURUSD is good or no to go short? thanks Rio. {image}
Hi Rio,

You just uploaded the H4 chart, in order to make a trading decision you need a top down supply and demand analysis of EUR/USD, which you haven't one, you just posted the H4. Can you please do the top down analysis, a decision can't be taken if you don't do that and I can't do your homework

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,274
  • Sep 29, 2015 8:41am Sep 29, 2015 8:41am
Quoting panoramia
{quote} Hi Rio, You just uploaded the H4 chart, in order to make a trading decision you need a top down supply and demand analysis of EUR/USD, which you haven't one, you just posted the H4. Can you please do the top down analysis, a decision can't be taken if you don't do that and I can't do your homework Cheers, Alfonso
This is daily levels
Attached Image (click to enlarge)
Click to Enlarge Name: EURUSDDaily.png Size: 85 KB

and this my H4
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 35 KB


in daily is Consolidation because the TL is broken but demand zone not taken out. can i go short in H4 or must wait in daily supply?

thanks
Rio
from loser to be hero
  • #6,275
  • Sep 29, 2015 8:42am Sep 29, 2015 8:42am
Quoting Sants
{quote} Hi alfonso Here's the chart i mean. below is GBPUSD in Daily chart. May you correct me if im wrong (1) The trendline connecting valley1 and valley2 is valid right? and its broke after there's a candle that has OHLC below the trendline. (Valley1 demand zone is valid due to removal previous descending trendline). Hence, valley2 demand zone is no longer valid and tradeable. How about the valley1 demand zone? is it invalid too or its still valid?
There was a second valley later which would validate 2nd TL. You are forgetting a VERY VERY important thing of the strategy and market analysis Sants, you are using ONLY one timeframe you make decisions You need to make a top down analysis of 3 timeframes at least. A Zone may not be valid as per that timeframe's trendline but if nested within a bigger timeframe which is trending then it WILL be, but if you only look at the Daily chart you will be missing many opportunities and only seeing the trees and not the forest. Which is probably why you are having these confusions in the first place.
Quote
(2) after the breaking the first trendline, price makes another valley (valley 3). are we allowed to draw a trendline connecting the valley 2 and valley3? as per the rules says 2 obvious valleys for trendline. but the valley 2 demand zone is no longer valid because of (1) condition (ascending trendline broke). Alternatively, can we draw the trendline connecting valley1 and valley3?

We can draw new trendlines, but like I said it all depends on multiple timeframe analysis, which you have not done or included. You are missing the bigger picture and...[/quote]

Quote
(3) and the previous quoted image, may i know when the CP supply is considered as valid level? is it because due to trendline? Sants

I guess you are referring to Gold's chart, which you attached. CP demand is valid when it takes out opposing supply, as rules state. We can clearly see that on the chart.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,276
  • Sep 29, 2015 8:56am Sep 29, 2015 8:56am
Quoting rio cyrano
{quote} This is daily levels {image} and this my H4 {image} in daily is Consolidation because the TL is broken but demand zone not taken out. can i go short in H4 or must wait in daily supply? thanks Rio
You tell me Rio, what do rule say about it? You just used 2 timeframes, 3 are needed for top down analysis. You must reach a conclusion after your analysis, why are shorts allowed or why they are not, if I tell you then you will always have the same questions over and over. Give it a try please, share with us an IF then scenario based on imbalances and the high odds trend, when shorts are allowed or if longs would be allowed. Since you are only using 2 timeframes, you are missing the bigger picture, thus a correct and more accurate answer.

I can do that, but I've done that thousands of time, we're not here to talk what I would do, I know what to do (I may be wrong or right, it's all about probabilities), we're here to try and help each other, you have to make mistakes in order to learn, I can't tell you what to do, you have to do it yourself, or you will find it hard to gain the skills to do it by yourself.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #6,277
  • Edited 9:29am Sep 29, 2015 9:08am | Edited 9:29am
Quoting panoramia
{quote} There was a second valley later which would validate 2nd TL. You are forgetting a VERY VERY important thing of the strategy and market analysis Sants, you are using ONLY one timeframe you make decisions You need to make a top down analysis of 3 timeframes at least. A Zone may not be valid as per that timeframe's trendline but if nested within a bigger timeframe which is trending then it WILL be, but if you only look at the Daily chart you will be missing many opportunities and only seeing the trees and not the forest. Which is probably...
ehmm by the image uploaded, im using your indi the 'rectangle reader' i have drawed the weekly levels as shown in default settings....and yeah, demand zone number 1 and number 2 is nested within the weekly demand zone as weekly zone shown.

i mean the CP supply marked by red hollow rectangle, when that CP supply is valid? sorry Alfonso, im not asking about the CP demand marked by yellow hollow rectangle

edit:
-sorry if im using only 2 tf here, but my point is the trendline yes a revision and confirmation, a nested zone is cant be invalidated if inside the HTF zone, noted
-hence, we can draw the second trendline connecting 2nd valley to 3rd valley. after the broke of 3rd valley, is the 3rd demand zone is nolonger valid? as it is not nested in any HTF zone? as per rules said connecting trendline from the latest 2 obvious valleys/peak.
-and after the break of 3rd valley, price manage to form a 4th valley and we able to draw the 3rd trendline connecting 3rd valley and 4th valley. now, after the removal the 3rd valley demand zone, is the trendline connecting 3rd and 4th valley is valid? i mean, 3rd valley is terminated isnt it? or we ignore the 3rd valley and go connecting 2nd valley and 4th valley?
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 70 KB
  • #6,278
  • Edited Sep 30, 2015 7:58am Sep 29, 2015 9:39am | Edited Sep 30, 2015 7:58am
Quoting panoramia
{quote} You tell me Rio, what do rule say about it? You just used 2 timeframes, 3 are needed for top down analysis. You must reach a conclusion after your analysis, why are shorts allowed or why they are not, if I tell you then you will always have the same questions over and over. Give it a try please, share with us an IF then scenario based on imbalances and the high odds trend, when shorts are allowed or if longs would be allowed. Since you are only using 2 timeframes, you are missing the bigger picture, thus a correct and more accurate answer....

Thanks Alfonso, after I reread your modules again, now I know where is my mistake. the trend line, where the trend line as a confirmation of the levels of demand and supply, it seems easy, but I was wrong. I should be more careful in determining the level is valid or not.

example :
EURJPY
WK leves
Attached Image

D1 Levels
Attached Image


the price reach the WK supply, and in D1 TL is broken to down but not taken out demand zone (consolidation), can we draw the new level in daily, even demand zone in daily not removed? because we high in the curve WK. or we wait D1 demand zone is taken out?




thanks

Rio
from loser to be hero
  • #6,279
  • Sep 30, 2015 9:18am Sep 30, 2015 9:18am
Quoting rio cyrano
{quote} Thanks Alfonso, after I reread your modules again, now I know where is my mistake. the trend line, where the trend line as a confirmation of the levels of demand and supply, it seems easy, but I was wrong. I should be more careful in determining the level is valid or not. example : EURJPY WK leves {image} D1 Levels {image} the price reach the WK supply, and in D1 TL is broken to down but not taken out demand zone (consolidation), can we draw the new level in daily, even demand zone in daily not removed? because we high in the curve WK. or...
as far I understood your first TL is wrong. we dont draw TL on CP, only valleys
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  • #6,280
  • Edited 9:45am Sep 30, 2015 9:35am | Edited 9:45am
Quoting Bernhard
{quote} as far I understood your first TL is wrong. we dont draw TL on CP, only valleys
Hi Bernhard,

I think we can draw TL on CP, if we have 3 CP my friend.

USING TRENDLINES AS DIRECTION AS WELL AS FILTERING OUT LEVELS IN A MECHANICAL WAY

"After 3 or more consecutive CP patterns, we will draw a more aggressive trendline comprising all 3 CP patterns, price will be over-extended by that time and we don't want to take a trade after a strong rally/drop in price"



thanks

Rio
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