Demand and Supply zone trading

Tavnaz

Tavnaz

Well-Known Member
#101
#101
princy01 said:
no supply zone present ? am i right?

Click to expand...
According to your chart and zone you marked,your Zone was blown away after the gap,

You will need a new supply zone higher up now.

Apparently the orders were either consumed or not there at all.
How did we know what to do??
If you were a newbie you placed a blind short in the zone,if you were a good trader you would have done PA watch in the zone.
A Good bearish Bar on the hourly chart that breaks its low would have been nicer.
Range break on nifty still seems doubtful though.
I think we need one more bull day, before we can be certain its gone.

If you need to learn about PA watch in the zones go to my previous post,link of threads that will help you has been posted,learn what to look for in the zone in those threads.
Once you learn PA watch,you will know how to use supply demand zones in a better way ,so read more about it in those threads,PA will confirm the supply or demand in the areas,so learning PA is very important.

There are many things that have already been discussed there ,which if discussed again here will be fruitless and time consuming,so for that you must read those threads.
Hope you have good read.

God bless you.
;-)
 
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amandeep86

amandeep86

Well-Known Member
#106
#106
Hi,

I m learning to use Supply and Demand concept ,Have few questions please spare few times to answer them.

1.Zones created due to reaction of some other previous zone to be treated as Fresh zones ?

2.How to amalgamate HTF zones while trading lower TF's zones.If we are trading inside zones of HTF ?
 
Tavnaz

Tavnaz

Well-Known Member
#107
#107
amandeep86 said:
Hi,

I m learning to use Supply and Demand concept ,Have few questions please spare few times to answer them.

1.Zones created due to reaction of some other previous zone to be treated as Fresh zones ?
Yes spikes and reactions which visibly push the price in one direction will be fresh zones.
And if the above reaction has not fully reached the zone which was spiked previous zone will still exist. Infact you will have two zones on top of each other.
Normally in those cases price always goes to lower zone.

2.How to amalgamate HTF zones while trading lower TF's zones.If we are trading inside zones of HTF ?

While trading supply Demand Zones there is always the time frame on which it is drawn and the time frame on which it is used.
We will call the time frame where we draw zones as Set up time frame.
And the time frame where we trade and see what happens in the zone where the real stuff is happening as PA watch time frame.
Amalgamation comes when we mix them together,now on the daily demand zone you would expect it to cause move on daily chart right?
And 4 hour zone you would expect move to show up on 4 hour chart.

The move i am taking about is the money making move we were expecting on the zone.
But in order to trade the move you need to see Price action to see if the orders we are expecting are there or not,that is where the lower time frame the PA watch time frame comes into play.

So we go into PA watch time frame and start looking for moves that show that buyers are there in case of demand zone,and vice versa for supply zone.

Most Common of them being the Double Bottom or a Support,vice versa for a supply zone
Bullish Engulfings(very juicy) on lows or Pinbars(are Pathetic though),
The only signs you will ever need are engulfing bars and pin bars.
Click to expand...
See images:

See image for first question:


Setup chart:


See zones of multiple time frames are interrelated:


See how trade was taken and it travelled across various time frames,how higher time frame zones can contain several lower time frame zones.
remember if i was trading the weekly i would like an engulfing on atleast a daily chart you have to learn price action in detail for that read the thread price is everything.
oops the pa watch time frame i selected is 15 min not 5 min a small error in image.


hope this helps.
 
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amandeep86

amandeep86

Well-Known Member
#108
#108
Tavnaz said:
I will edit post as needed ,i am not done with it
Click to expand...
Thanks dear for all efforts taken to make this clear.I am trying to write what i understood from your post ,please correct for my understanding.

1.Reaction of a Zone is itself considered a fresh zone and zones stack over each other .

2.For Day Trading , i would mark fresh Zones from 30 TF and Look for pattern like False Breakout/DB/DT/123 on 5 TF to confirm my entry.

I would place my SL over the pattern H/L

Please answer few Questions more:-

1.Where to take profit ,Say i entered on 5TF on support at Demand Zone of 30 TF,Do i need to hold till i get supply zone of 30 TF or need exit a immediate next supply level on 5TF??

2.On fresh zones first reaction isvery fast ,Price just touch and move away without making any entry confirmation /pullback on 5 TF .How to enter in such cases?

3.Most of times price on LTF gives the reaction to zone moves a little in favour and reverses making complex pullbacks and eats our SL and again went to zone and struggles ,Do we re enter on such cases ??
 
Tavnaz

Tavnaz

Well-Known Member
#109
#109
amandeep86 said:
Thanks dear for all efforts taken to make this clear.I am trying to write what i understood from your post ,please correct for my understanding.

1.Reaction of a Zone is itself considered a fresh zone and zones stack over each other .
yes

2.For Day Trading , i would mark fresh Zones from 30 TF and Look for pattern like False Breakout/DB/DT/123 on 5 TF to confirm my entry.
yes
I would place my SL over the pattern H/L
yes
Please answer few Questions more:-

1.Where to take profit ,Say i entered on 5TF on support at Demand Zone of 30 TF,Do i need to hold till i get supply zone of 30 TF or need exit a immediate next supply level on 5TF??

That depends if price made a big bearish engulfing bar on the 5 min supply zone,remember that 5 minute can change the 30 minute bar into a bearish bar,so if you are in a long and nearest 5 min supply is approaching see how price reacts and if 30 minute chart is showing signs of bearishness.
If the price goes clean through nearest 5 min zone take profit at next 30 min supply zone,Or run the setup if price goes through next30 min zone as well,watch the bigger time frames if they are becoming bullish as we move,if they are then hold other wise close the trade.


2.On fresh zones first reaction isvery fast ,Price just touch and move away without making any entry confirmation /pullback on 5 TF .How to enter in such cases?

In these cases we can trade the high break,or low break of the 15 minute bars with stops behind nearest high,
Normally price does knock out sideways for some time even on the move like this at some point ,i have a fresh chart showing exactly that,i will post it.

3.Most of times price on LTF gives the reaction to zone moves a little in favour and reverses making complex pullbacks and eats our SL and again went to zone and struggles ,Do we re enter on such cases ??

What you are calling a complex pullback is called a support ,i will post an example.
Click to expand...
Read my answers in red
 
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