In trading, Supply and Demand "zones" are a more advanced version of horizontal Support and Resistance lines and are based on the areas created by rallies to the upside (distributions) and price drops (accumulations). A supply zone is an area where there is a lot of selling activity, and a demand zone is where there is a lot of buying activity.Piphunterss wrote: Wed Oct 23, 2024 1:24 am Hi Guys I want to Understand the true Meaning of Support and Resistance / Supply Demand i know there are tons of indicators available plus trader can manually draw supply demand but as i traded more and more i felt these levels never hold in expansion hwhen market expand with trend , so Question is what is the true criteria of supply demand zones in Forex , other previous week day and month .
Piphunterss wrote: Wed Oct 23, 2024 1:24 am Hi Guys I want to Understand the true Meaning of Support and Resistance / Supply Demand i know there are tons of indicators available plus trader can manually draw supply demand but as i traded more and more i felt these levels never hold in expansion hwhen market expand with trend , so Question is what is the true criteria of supply demand zones in Forex , other previous week day and month .
Oh yeah agreed.....Jimmy wrote: Wed Oct 23, 2024 10:51 am From a technical standpoint, in all my years of trading, Supply and Demand zones as well as horizontal support and resistance are only good for scalping and making quick profit, I'm talking about a quick few points or 10 pips on majors and that's it.
S&R levels are not an indicator as such but more a warning that price is entering a potential area of increased volatility and you should have a plan for any of the 3 possible outcomes. Sudden price reversal, sudden price breakthrough or price entering a phase of consolidation. Of course that can happen anywhere but based on previous events there is the increased possibility of lurking unfilled orders at these levels.Piphunterss wrote: Wed Oct 23, 2024 1:24 am Hi Guys I want to Understand the true Meaning of Support and Resistance / Supply Demand i know there are tons of indicators available plus trader can manually draw supply demand but as i traded more and more i felt these levels never hold in expansion hwhen market expand with trend , so Question is what is the true criteria of supply demand zones in Forex , other previous week day and month .
Jimmy wrote: Wed Oct 23, 2024 10:51 am In trading, Supply and Demand "zones" are a more advanced version of horizontal Support and Resistance lines and are based on the areas created by rallies to the upside (distributions) and price drops (accumulations). A supply zone is an area where there is a lot of selling activity, and a demand zone is where there is a lot of buying activity.
From a technical standpoint, in all my years of trading, Supply and Demand zones as well as horizontal support and resistance are only good for counter-trend scalping and making quick profit, I'm talking about a quick few ticks or pips on majors and that's it.
If you're just starting off as a trader and have a solid trend trading strategy already, it's only good to mark the higher timeframe's Supply and Demand zones for reference if:Round numbers also. But if you're swing trading strong trends on big timeframes such as the 4H, Daily, Weekly and Monthly try not to focus those zones as it will cast fear and doubt in your positions.
- You're eying out short-term tops and bottoms on lower timeframes
- Looking at exiting swing positions that are already in profit and heading towards these "zones"
You are right, if the market is moving there's just no stopping it.
When I was working as a bond trader we never even drew any lines or support and resistance on our charts. Even though we were using a process called Market Making (pretty much scalping in both directions) I cannot remember a time where my colleagues or I discussed any major support and resistance areas coming up.
To give you an idea on what our screens looked like, here's a screenshot of my work desktop. One monitor, one trading platform and a DOM ladder with black and white bar chart minimized behind it just for reference.
No supply and demand zones here!
important points hereOgee wrote: Wed Oct 23, 2024 10:25 pm S&R levels are not an indicator as such but more a warning that price is entering a potential area of increased volatility and you should have a plan for any of the 3 possible outcomes. Sudden price reversal, sudden price breakthrough or price entering a phase of consolidation. Of course that can happen anywhere but based on previous events there is the increased possibility of lurking unfilled orders at these levels.
The real question is how to play S&R levels. Trying to play major reversals is not for the faint hearted or novice. Price often fluctuates at these levels instead of reversing. Major reversal traders tend to have a low win rate but aim for a high reward:risk ratio if it goes well.
The easier strategy is not to try to predict what will happen but rather to anticipate what could happen. Price will either reverse or breakout or consolidate. Try applying the 'Wyckoff method' (Google it), after some consolidation (even if just on the lower time frames) price will kick off in one direction, wait for the retest, then wait for the retest to fail. That's when you want to jump in (look for increasing volume as others do the same). Be in for the ride to the next significant level (range expansion).
Because S&R levels can often be a battleground between buyers and sellers what you want to avoid is getting caught out buying with price heading up into resistance or selling with price heading down into support.
Instead think to be buying with price heading up and away from support or selling with price heading down and away from resistance.
Hope this helps.
yes yes yes this is what we are talking about price always get back to fair price , idea is when price go above the mean line it should atleast get back to test if there is still demand , vice versa for sell position ,, but question is can we use tick data of terminal to draw line like vwap which draw some kind of dot or arrow when there is more than average ticks ,, and price expands from there leaving a demand behind for retest ,,ionone wrote: Fri Oct 25, 2024 6:52 pm what you're looking for is what's called "Fair Price"
you can see trading as a market plac : prices get cheaper ? you can buy some
prices get higher ? time to sell
the hard part is to determine the "Fair Price", meaning the price that make something cheaper if under and more expensive if above
there is a saying in statisstics: " price always revert to the mean"
and that's true
so a good idea of a Fair Price is a simple moving average, and the price can divert from it but always goes back to it.
I agree with what was already written here.Piphunterss wrote: Wed Oct 23, 2024 1:24 am Hi Guys I want to Understand the true Meaning of Support and Resistance / Supply Demand i know there are tons of indicators available plus trader can manually draw supply demand but as i traded more and more i felt these levels never hold in expansion hwhen market expand with trend , so Question is what is the true criteria of supply demand zones in Forex , other previous week day and month .
Precise nonsense