Supply and demand in a nutshell by Alfonso Moreno | Page 428 | Forex Factory

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Supply and demand in a nutshell by Alfonso Moreno

  • #8,541
  • Jun 14, 2017 4:54pm Jun 14, 2017 4:54pm
Just some points to clarify, Mr Alfonso.

1) If price breaks TL on my entry TF (4HR), is it okay to still trade CP after the TL break if HTF is still the same trend as my entry TF? Or will I require my zone to be nested within HTF zones to trade that CP? Or is this not a tradable situation at all?

2) If on my entry TF, CP pattern doesn't look good but could hold. Am I allowed to look on LTF for entries? (This happened on my first live trade. Price hit my 4HR Supply and pierced it to SL. Touched 1HR CP right above my supply and dropped)

3) So I read the first 100 pages on your thread. Planning to read more. I have seen some trades where you do not require a RR of 3:1 or the zone to take our opposing SD (mostly CP) and still traded. Does this still apply? You explained that location is key. (could you further explain this to me?)

Thanks Alfonso. I appreciate all the effort you put in for this thread.
The only person you are destined to become is the person you decide to be.
  • #8,542
  • Jun 14, 2017 10:35pm Jun 14, 2017 10:35pm
Quoting isaacpeh
Just some points to clarify, Mr Alfonso. 1) If price breaks TL on my entry TF (4HR), is it okay to still trade CP after the TL break if HTF is still the same trend as my entry TF? Or will I require my zone to be nested within HTF zones to trade that CP? Or is this not a tradable situation at all? 2) If on my entry TF, CP pattern doesn't look good but could hold. Am I allowed to look on LTF for entries? (This happened on my first live trade. Price hit my 4HR Supply and pierced it to SL. Touched 1HR CP right above my supply and dropped) 3) So I read...
Continuation pattern doesn't look good? Skip it, as simple as that. Nested zones are higher probability, there are a series of rules for that, too long to explain in a few words. Location is key, but like i said, it would be like asking someone to explain why the earth revolves around the sun. There are lots of things to be taken into account, all of them are logical but you need to know all of them and have a lot of screentime to have your brain click.

Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #8,543
  • Jun 15, 2017 12:16am Jun 15, 2017 12:16am
Quoting panoramia
{quote} Continuation pattern doesn't look good? Skip it, as simple as that. Nested zones are higher probability, there are a series of rules for that, too long to explain in a few words. Location is key, but like i said, it would be like asking someone to explain why the earth revolves around the sun. There are lots of things to be taken into account, all of them are logical but you need to know all of them and have a lot of screentime to have your brain click. Cheers, Alfonso
Thanks for your response Alfonso. Tho is didn't really answer my question. I think I understand why "the earth revolves around the sun". You explained it in one of your posts way back.

Location is key :
eg: We are bouncing off HTF fresh supply and ascending TL breaks on LTF confirming we should go short. We want to take every entry we can on the way down. (Maybe that's why RR or the 6 odd enhancers didn't matter).

that's what I read as far as I know.

Sorry if I'm disturbing you in any way, I don't mean it
But what I'm really asking is my first point.

1) If price breaks TL on my entry TF (4HR), is it okay to still trade CP after the TL break if HTF is still the same trend as my entry TF? Or will I require my zone to be nested within HTF zones to trade that CP? Or is this not a tradable situation at all?

At it, I shall add on another ;

2) If price is diddle in the middle, supply in control on HTF. Still having area down to HTF demand, Is it okay to short CP on LTF if LTF is on a clear downtrend?

I'm in no position to get you to reply but it'll be greatly appreciated if you would It'll clear the last of my doubts about this methodology at least. (or maybe not)

cheers,
Isaac
The only person you are destined to become is the person you decide to be.
  • #8,544
  • Jun 15, 2017 1:37am Jun 15, 2017 1:37am
Quoting isaacpeh
{quote} Thanks for your response Alfonso. Tho is didn't really answer my question. I think I understand why "the earth revolves around the sun". You explained it in one of your posts way back. Location is key : eg: We are bouncing off HTF fresh supply and ascending TL breaks on LTF confirming we should go short. We want to take every entry we can on the way down. (Maybe that's why RR or the 6 odd enhancers didn't matter). that's what I read as far as I know. Sorry if I'm disturbing you in any way, I don't mean it But what I'm really...
First of all Isaac, you are not disturbing me at all. It's just that answering your question requires a lot of detail and many other rules to be involved, like I said above. You are looking at very specific scenarios that have other rules involved that haven't even been mentioned in the thread. You will have many other doubts, there are quite a few scenarios missing, more advanced, that requires understanding of other concepts. Each scenario is different and price action needs to be analyzed to see if imbalances are in jeorpardy or not, but like I said, that's a different story. Remember this thread is covering the basic setups and imbalances. I answer all questions but when there are times when the answer requires the understanding of other scenarios. What is true for scenario 1 will not be true for similar scenarios 2 or 3 if price action is telling us a different story. Supply and demand creates price action and price action makes supply and demand.

Location is key, odds enhancers and limiters have to be analyzed, there are more than 6, those 6 are the main ones, there are others. Bouncing of a bigger timeframe area of imbalance, don't go against it in lower timeframes levels.

Regards,
Alfonso
Set and Forget supply and demand trading community
  • #8,545
  • Jun 15, 2017 1:37am Jun 15, 2017 1:37am
Hi Isaac

If your entry TF TL is broken then you have to wait for a HTF zone, this a major part of the realignment rules. 4hr tl broken, wait for daily zone. daily TL broken wait for weekly zone etc. There are additional rules for flip zones, htf 20ema etc. But as Alfonso suggests test/test/test until you are confident. As Alfonso mentions above if price has hit a weekly/monthly zone then you would not take a daily zone against it.

Diddle in the middle - if your entry tf is the 4hr, then you need momentum on the daily. Again test see what works. Trade pairs that are trending not in consolidation, there are plenty of them. Be selective.

Do you use forex tester?

Kevin
  • #8,546
  • Jun 15, 2017 1:46am Jun 15, 2017 1:46am
Quoting panoramia
{quote} First of all Isaac, you are not disturbing me at all. It's just that answering your question requires a lot of detail and many other rules to be involved, like I said above. You are looking at very specific scenarios that have other rules involved that haven't even been mentioned in the thread. You will have many other doubts, there are quite a few scenarios missing, more advanced, that requires understanding of other concepts. Each scenario is different and price action needs to be analyzed to see if imbalances are in jeorpardy or not,...
Understood! Thanks so much
The only person you are destined to become is the person you decide to be.
  • #8,547
  • Jun 15, 2017 1:48am Jun 15, 2017 1:48am
Quoting kjg30
Hi Isaac If your entry TF TL is broken then you have to wait for a HTF zone, this a major part of the realignment rules. 4hr tl broken, wait for daily zone. daily TL broken wait for weekly zone etc. There are additional rules for flip zones, htf 20ema etc. But as Alfonso suggests test/test/test until you are confident. As Alfonso mentions above if price has hit a weekly/monthly zone then you would not take a daily zone against it. Diddle in the middle - if your entry tf is the 4hr, then you need momentum on the daily. Again test see what works....
waiting for a HTF zone meaning looking for confirmation on LTF when price hits HTF? And yes. I recently bought the Forex tester 3 when it was on sale!

Thanks once again
The only person you are destined to become is the person you decide to be.
  • #8,548
  • Jun 16, 2017 12:34am Jun 16, 2017 12:34am
hi mr alfonso
i,ve downloaded last version indicator from page 1
but rectanglereader indicator not work . why ?
i used last version mt4 .

Attached Image (click to enlarge)
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  • #8,549
  • Jun 16, 2017 1:13am Jun 16, 2017 1:13am
Quoting randolf
hi mr alfonso i,ve downloaded last version indicator from page 1 but rectanglereader indicator not work . why ? i used last version mt4 . {image}
Hello Randolf,

What is the problem? I see you are using an old template, have you downloaded it from https://www.set-and-forget.com/suppl...nd-indicators/ ?
Cheers,
Alfonso
Set and Forget supply and demand trading community
  • #8,550
  • Jun 16, 2017 8:56am Jun 16, 2017 8:56am
Hello traders & Alfonso.
Do you see any reason why this CP on NZD/USD did not work out?

I traded that CP for the following reasons :

 

  1. Price is @ WK / D1 Fresh supply zones
  2. On the H4 , descending TL broke. Creating a nice supply @ CP
  3. CP is only 13pips so RR is at least 2:1 (Wiggle 7pip / Padding 2pip)


Any reason for this trade setup to fail? Or rather, is this a valid trade setup? Am i missing something out?
Do let me know your thoughts . Hope to learn something from this loss.

Oh , I also planned a trade at the extremes at around 0.72670. Zone was too wide so i went to H1 and planned it there instead. Hopefully that will work out

H4 :

Attached Image (click to enlarge)
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D1:
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WK:
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The only person you are destined to become is the person you decide to be.
  • #8,551
  • Jun 16, 2017 9:09am Jun 16, 2017 9:09am
Here's another loss on EUR/CAD. (green CP zone)
Same question , Was this a valid trade?

In my opinion i thought that my zone was too wicky and therefore easily absorbed.

 

  1. Price is at MN supply
  2. On the WK it's finally reacting to super long wicky supply. (Probably confluence of MN supply)
  3. D1 descending TL broken.
  4. Shorted at H4 CP (wicky?) zone.
  5. Room to opposing demand.

Will the short @ 1.51400 D1 supply zone be a good area to go?
As always , i hope to learn from my losses
Do let me know your opinions! Much appreciated.

More forward testing in the weekends for me!

Cheers.

H4:

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D1:
Attached Image (click to enlarge)
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WK:
Attached Image (click to enlarge)
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MN:
Attached Image (click to enlarge)
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The only person you are destined to become is the person you decide to be.
  • #8,552
  • Jun 16, 2017 10:03pm Jun 16, 2017 10:03pm
Quoting isaacpeh
Hello traders & Alfonso. Do you see any reason why this CP on NZD/USD did not work out? I traded that CP for the following reasons : Price is @ WK / D1 Fresh supply zones On the H4 , descending TL broke. Creating a nice supply @ CP CP is only 13pips so RR is at least 2:1 (Wiggle 7pip / Padding 2pip) Any reason for this trade setup to fail? Or rather, is this a valid trade setup? Am i missing something out? Do let me know your thoughts . Hope to learn something from this loss. Oh , I also planned a trade at the extremes at around 0.72670....
Hi Isaacpeh, i think because you are selling at Daily Demand Zone
  • #8,553
  • Jun 16, 2017 11:06pm Jun 16, 2017 11:06pm
Quoting omarr
{quote} Hi Isaacpeh, i think because you are selling at Daily Demand Zone
Of course! Thanks so much! Guess I was so focused on the supply I missed that D1 CP out!

My guess would be to wait for the D1 TL to break before selling altho the supply is fresh? Since CP ain't good against the trend
The only person you are destined to become is the person you decide to be.
  • #8,554
  • Jun 19, 2017 1:00am Jun 19, 2017 1:00am
Triggered on NZD/USD .
After a loss on the CP supply, price hit the upper supply zone. (See previous posts)
Seems like it's showing some kind of rejection. Hopefully it'll be a runner.

 

  1. Price is within fresh area of supply on the H4 within D1 and WK as well.
  2. Price broke H4 ascending TL showing confirmation for a confirmation type of trade.


H4 Chart:

Attached Image (click to enlarge)
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Missed my long entry on AUD/NZD as well by 3 pips.

Attached Image (click to enlarge)
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Are these valid trades as per the rules? Do let me know your opinions and critics.

Cheers.
The only person you are destined to become is the person you decide to be.
  • #8,555
  • Edited Jun 20, 2017 8:29am Jun 19, 2017 5:38pm | Edited Jun 20, 2017 8:29am
Hello guys, Hey Alfonso.

USDJPY

- I did a Top-Down Analysis (Monthly/Weekly/Daily)
- I think I'm doing fine analysing the charts using the rules, BUT I'm bad doing the conclusion

In this chart, am I allowed to Sell at the Daily SZ and buy up again at my Daily DZ?
I currently don't see a trend, that's my problem.

OR should I wait for some kind of confirmation?


Please enlighten me guys, here is the Chart:

Many thanks in advance!

MONTHLY:
Attached Image (click to enlarge)
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WEEKLY:
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPY-W.jpg Size: 160 KB


DAILY:
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPY-D.jpg Size: 203 KB


MY PLAN WOULD BE:
Wait for confirmation of an Uptrend in the Daily (price has to move higher than the purple line), THEN Buy at the Daily DZ nested in the Weekly DZ UP till the big SZ at the top of the Screenshot.
Sounds smart?
  • #8,556
  • Jun 19, 2017 8:36pm Jun 19, 2017 8:36pm
Quoting r00flr00fl
Hello guys, Hey Alfonso. USDJPY - I did a Top-Down Analysis (Monthly/Weekly/Daily) - I think I'm doing fine analysing the charts using the rules, BUT I'm bad doing the conclusion In this chart, am I allowed to Sell at the orange circle and buy up again at my demand zone (blue arrow up)? I currently don't see a trend, that's my problem. OR should I wait for some kind of confirmation? MY PLAN WOULD BE: Wait for confirmation of an Uptrend in the Daily (price has to move higher than the purple line), THEN Buy at the Demand Zone with the Blue Arrow UP...
We'll need not only 1 chart for a top down analysis! Please show us your HTF charts as well, not only your entry.

On your entry TF is seems like the trend is a broken Down trend.
The only person you are destined to become is the person you decide to be.
  • #8,557
  • Jun 20, 2017 2:24am Jun 20, 2017 2:24am
Quoting isaacpeh
Triggered on NZD/USD . After a loss on the CP supply, price hit the upper supply zone. (See previous posts) Seems like it's showing some kind of rejection. Hopefully it'll be a runner. Price is within fresh area of supply on the H4 within D1 and WK as well. Price broke H4 ascending TL showing confirmation for a confirmation type of trade. H4 Chart: {image} Missed my long entry on AUD/NZD as well by 3 pips. {image} Are these valid trades as per the rules? Do let me know your opinions and critics. Cheers.
Hey isaacpeh,
Here's my take:
NZDUSD is in w1 up trend while in a mn sideways trend as well. Therefore the 4h short is counter trend. The w1 sz you are using have been hit several times, therefore it holds low odd. However a fresh w1 sz stood higher up around 0.7493. Taking a counter trade (if you choose to) within that zone is more like it, of course on confirmation.

AUDNZD is also a counter trade. A 4h dz is located inside w1 and d1 dzs which increase the odds for counter trade. Therefore a confirmation trade is worthwhile proposition, however you have to be careful at that because there were several retracements into the zone. see charts below.
Attached Image (click to enlarge)
Click to Enlarge Name: 2017-06-20_nzdusd.png Size: 68 KB

Attached Image (click to enlarge)
Click to Enlarge Name: 2017-06-20_audnzd.png Size: 92 KB
  • #8,558
  • Jun 20, 2017 3:08am Jun 20, 2017 3:08am
Quoting jamaa
{quote} Hey isaacpeh, Here's my take: NZDUSD is in w1 up trend while in a mn sideways trend as well. Therefore the 4h short is counter trend. The w1 sz you are using have been hit several times, therefore it holds low odd. However a fresh w1 sz stood higher up around 0.7493. Taking a counter trade (if you choose to) within that zone is more like it, of course on confirmation. AUDNZD is also a counter trade. A 4h dz is located inside w1 and d1 dzs which increase the odds for counter trade. Therefore a confirmation trade is worthwhile proposition,...
hello JAMAA,
if i may,tell me please what is the w trend ?
Attached Image (click to enlarge)
Click to Enlarge Name: AUDNZDH4.png Size: 51 KB
  • #8,559
  • Jun 20, 2017 4:11am Jun 20, 2017 4:11am
Quoting jamaa
{quote} Hey isaacpeh, Here's my take: NZDUSD is in w1 up trend while in a mn sideways trend as well. Therefore the 4h short is counter trend. The w1 sz you are using have been hit several times, therefore it holds low odd. However a fresh w1 sz stood higher up around 0.7493. Taking a counter trade (if you choose to) within that zone is more like it, of course on confirmation. AUDNZD is also a counter trade. A 4h dz is located inside w1 and d1 dzs which increase the odds for counter trade. Therefore a confirmation trade is worthwhile proposition,...
Thanks for your opinions . Yes I'm aware they are counter trend trades. I took them based on H4 confirmation! A little bit aggressive there. I took them anyways since they were nested zones! (WK is fresh in my charts. See my above post) Hopefully it'll work its way down on the NZD/USD . Only afraid that on the D1 up TL. it'll be a confluence for the trend.

For the AUD/NZD. There was a clearly nested zone so I just decided to take the risk on the counter trend trade!. Pity I missed it.
The only person you are destined to become is the person you decide to be.
  • #8,560
  • Edited 4:37am Jun 20, 2017 4:19am | Edited 4:37am
Quoting Autokon
{quote} hello JAMAA, if i may,tell me please what is the w trend ? {image}
As you can see in the attached picture. The demand was created because an aggressive down trend line was broken. Hence , creating the demand area!

It's clearly a broken down trend. We're low in the curve on the MN/WK/D1 charts. (reason why I went long on AUD/NZD). If you wish to go shorts you need to wait for confirmation by taking out DZ on HTF.

Attached Image (click to enlarge)
Click to Enlarge Name: IMG_20170620_191243.jpg Size: 218 KB
The only person you are destined to become is the person you decide to be.
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