how's it going traders in this video i'm just going to do a quick 10 minute little lesson
on supply and demand from start to finish all the important aspects of trading supply and demand so
if you liked the video make sure to hit that like button and subscribe if you are new to the channel
first things first just want to point out what is not demand or supply if you see all
this choppiness here that is not demand or supply there's nothing going on right there at all this
is just equilibrium of buyers and sellers but if you look right here you can see a clear push up
after all of this range and that is demand so how you would draw that would be something like this
you just draw your demands on around there and i'll touch more on that in a bit but i
just wanted to show you guys the basics of what supply and demand is clearly buyers took control
here and pushed price up higher and got rid of all the sellers because sellers could not push
down price anymore and the same thing goes for supply over here we have a supply zone as you can
see here there was no supplier demand in this area right here but then all of a sudden boom sellers
took over buyers and supply exceeded demand and that's why we got that pushed down and that is
just a great idea of what a trade looks like when you take the pullback back to here and it pushes
back down so that is the intro to you know what supply and demand is and what it looks like on a
price chart next we have the two types of supply and demand zones one we have a drop based rally
and the next we have a rally base rally and the same thing goes for supply but in reverse so as
you can see here we have price up here it drops bases and rallies up so what is that that is a
drop based rally aka what i like to call a pekin valley demand zone right here and this
is the different one this is the second one here we have a push up a small base right here in the
form of one candle and then another push up that is a cp pattern which is a continuation pattern
which is also known as a rally base rally and we also have another rally base rally right here and
there's actually another one right there so hopefully you guys understand the difference
um between the two types of supply and demand and remember if you have any questions at all just
leave them in the comments down below and i'll get back to every single question and like i said
about supply the same thing goes for supply it's just in reverse so as you can see here we have a
supply zone right there and then we have a supply zone right here well that's this top one here is
a rally base drop and this one is a drop based drop so just the complete opposite for supply
all right the next thing to consider when trading supply and demand is multiple time frame analysis
and this is probably the most important factor in trading so make sure you pay attention to this
and supply and demand there's three time frames we usually use so your higher time frame your
intermediate time frame and your entry time frame and they're pretty self-explanatory but let's say
you want to enter on a one-hour chart and if you have any questions on what time frame you
should be using drop it down in the comments down below and i will get back to you so right here
our higher time frame is the daily chart so this is a daily chart we're looking at right now and
the first thing i notice is this demand zone right here and this is just an example i'm picking this
one out because it ended up working so i just want to show you guys just for the sake of the example
so this would be your daily demand zone right here so then when you're looking for a trade on your
entry time frame which in this instance would be the one hour chart you'll start to notice as price
comes down into daily demand right here you'll start to see a lot of supply and demand zones
work very well as you can see one right there another one right here another tiny one right here
that wasn't really a zone but ended up working and eventually they start to fail not every zone works
but that this is the idea of multiple time frame analysis where you're understanding that price
is pulling back into a higher time frame demand zone and then looking for demand zones to trade
as price comes out of there and looking to take profits above so that is multiple
time frame analysis all right now we're going to look at different entry types and remember
if you guys want all of my zones that i draw on a daily basis to use in your trading check out
the patreon or youtube membership links are in the description you can get my zones on a daily basis
and i'd be happy to see you guys join the team and you can definitely benefit from my
zone so hope to see you guys join the team so now we're looking at now we're going to
look at the different types of entries there's two different entry types we have a confirmation trade
and a send forget trade now i do have two full videos on these two topics so check out the
tips playlist links in the description there but i'm just going to touch up on it quick so what
i showed you guys earlier when price was inside this daily demand and we hopped down to a one hour
chart when i was explaining multiple time frame analysis well that is what a confirmation trade
looks like confirmation is an entry when you wait for higher time frame to manage supply to be hit
and then you look to trade as the same you look to trade along with price as price comes down
into your higher time frame and you're basically waiting for confirmation you're waiting for supply
zones to be taken out and you're waiting for this downward trend to break and then that's
your confirmation and you go up from there and you start taking trades from there so hopefully
that makes sense and then the second one and this one only really works well in the trending market
is set and forget trades and here are two great examples of set and forget trades this would be
a set and forget trade because it's a cp it's the continuation pattern zone and this right
here is also a set and forget trade where you're just taking a trade here stop loss here and there
now the shape of the trade for confirmation is the exact same as this but the difference is we're not
looking we're not going down to a lower time frame and looking for confirmation in there we're just
simply trading along with this upward trend and just send forget trading along the way up so if
if you want a more detailed breakdown check out the supply and demand tips playlist all right
next i'm going to show you guys how to draw supply and demand zones and there's not one exact way to
draw them what i like to do is just kind of take the main base of a zone and then draw that so just
for an example a little demand zone right here you would just take the bottom candle right you'd use
this little magnet tool over here let me mark it out for you guys you would use this magnet tool
right here in order to attach to the wicks of the candle and then you would try to align the top of
it for a demand zone along the top of these basin candles right here that's what you would usually
do on a nice clean supply demands or sorry supply or demand zone and the same thing kind of goes for
a continuation pattern zone as well i just want to show you guys up here so for these two right here
as you can see here i took the bottom of this wick and i attached it to the top of the base up here
and like i said if you have any questions at all please don't hesitate to ask and then for this
continuation pattern zone i don't want to have the zone be too small like this because then the entry
becomes a little harder to get so what i like to do is just make the zone a little bit bigger maybe
the whole wick in this circumstance like i said there's no right or wrong way just test out what
you like and what works for you and eventually you'll figure out what exactly works but there's
no right or wrong way all right now we're gonna go over exactly how you would place a trade so for
demand zone exactly what you do is you would be trying to enter a little bit before the zone with
your stop loss below and a target above at least you know two to one away but there's not an exact
way to do this if you take a risk to reward tool like this it's going to look something like this
where you have your entry up here your stop loss just below maybe a target at three to one
or whatever you want to do and there's no right or wrong way so to make it really quick to summarize
your entry goes here your stop loss goes below the zone and target up above i know some people don't
like to have targets so they like to trim off uh their profits as they go and that's completely
fine and the same thing goes for supply you you would put your short order right there
and your stop loss above and your target below so like i said entry stop loss and target below
you're just shaping the trade around the rectangle box that you're using to draw your supplier demand
zones all right last thing here i just want to show you guys different ways to manage
your trade so let's say you took a short position here and you got filled right here now how do you
take profits a lot of guys do it differently like they like to trim off profits along the way down
or some like to just take a two to one or a three to one but here's one way i'm going to show you
a few different ways where let's see if you took a short here you simply look for opposing demand
and take profits there so as you can see here there is opposing demand right here that's why
it's beneficial also to use my zone so definitely check out the membership you can use my zones to
help with your take profits and here let's say i had a zone right here well you could have taken
your trade right here found my zone right here and taken profits right before this demand zone right
there and that would have worked out beautifully so that's one way is just to take profits before
opposing uh time frame demand zones other this is another way here let's say you enter your sorry
we didn't even get filled there so let's just go up to this one here oops so let's say you took
this said forget trade right here well one thing you could do is simply if i can get my tool out
if you enter here your stop loss is here you could look to take profit at the high that's one way or
you could take you know 50 percent off at the high and let the rest right and maybe move your stop
loss up to break even uh or what other people do is they and this is what i like to do i just like
to set my wrist to reward tool here and i like to look for two and a half the ones or sometimes
three to ones and just get out and find the next trade so if you guys want to see a detailed
breakdown of a video explaining that in detail uh just let me know i can maybe do that so hopefully
you guys found this video helpful i know it was quick but i try to get straight to the point
if you have any questions at all don't hesitate leave them in the comments down below
i'd be happy to get back to you guys and like i said check out the youtube or patreon
membership if you want to get used to supply and demand and use my zones in
your trading so with that being said take care guys i'll see you in the next video