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Honaut: Strong Daily Demand Zone & 44,000 Weekly SupportHonaut is currently trading entering a strong daily demand zone between 44,275 and 43,060, which could offer significant support if price stays within this range. Additionally, we observe a key weekly support line at 44,000 (also aligns with a psychological level). This makes it an even more significant area for potential price action. Key Levels: Daily Demand Zone: 44,275 and 43,060 Weekly resistance turned support Line: 44,000 (previous resistance now acting as support) If the price remains within the demand zone, this could be an ideal area for potential reversals, especially with the added confluence of the 44,000 psychological level. Watch for price action confirmation and the possibility of an uptrend continuation or reversal as the price approaches this zone.
NSE:HONAUTLong
by JS_Trading_Tradingmadesimple
Reliance in confluence of demand zones- Long OpportunityReliance is currently sitting in the weekly and daily demand zones, providing strong support. weekly zone Daily zone: However, the price has yet to reach the 4-hour and 2-hour demand zones, which are located near the bottom of the weekly and daily zones, adding further strength to this area. For an ideal long entry, wait for the price to touch the 4-hour and 2-hour demand zones, as this will reinforce the potential reversal. Once these zones are tested, a breakout above the key trendline could signal a bullish move. Monitor the trendline breakout as confirmation to take a long position.
NSE:RELIANCELong
by JS_Trading_Tradingmadesimple
Proximal and Distal Line Plotting For Supply and Demand ZonesProximal and Distal lines are important components of any Supply and Demand zone. One needs to plot two horizontal lines to mark Supply and Demand Zones. To know How to draw these lines, you need to understand Supply and Demand Zone formations. Proximity means nearest to the current price, while distal means farthest from the current price. What is the need to draw Proximal and Distal lines on a zone? As a Supply and Demand trader, one needs to know which price point to enter and where to exit. The proximal line is used to define the entry point into a trade, and the Distal line defines the Stopping Point. We place our stop losses slightly beyond the distal lines of the zones. Have a look at the above image Supply zones are located above the current market price and Demand zones are located below the current market price. In the illustration above, CMP is Rs.1668.3 The green-shaded zone below CMP is the Demand zone. It has two horizontal lines one at Rs.1607.65 which is nearer to the current price, and it forms the proximal line, whereas the other horizontal line is at Rs.1588.75 which is far away as compared to Rs.1607.65, so it constitutes the distal line of the demand zone The pink-shaded zone above CMP is the Supply zone. It has two horizontal lines one at Rs.1688 which is nearer to the current price, and it forms the proximal line, whereas the other horizontal line is at Rs.1702.4 which is far away as compared to Rs.1688, so it constitutes the distal line of Supply zone. How to Draw Proximal and Distal Lines for a Demand Zone A Demand zone is a designated area on a chart where Demand exceeds Supply, and there is a high likelihood of having pending Institutional Buy Orders. We look to enter long trades when the price retraces back to the demand zone, in doing so we also participate along with the Institutions which increases the probability of the trade working in our favour. So it's important to correctly identify the Proximal line and Distal line of a Demand Zone. Let u see how to mark the Proximal and Distal line of a Demand Zone Proximal Line Marking For A Demand Zone Irrespective of whether it’s a DBR or RBR Demand zone, the proximal line marking method remains the same. There are multiple ways to mark proximal lines, I will discuss the one that I follow and is widely used. While marking the proximal line we look at only the Base Candles, Proximal line is plotted at the Highest Wick of the base candles. Distal Line Marking For A Demand Zone There is a slight variation while marking distal lines, depending upon whether it’s a DBR or RBR Demand Zone Distal Line For DBR Demand Zone We need to consider all three components, Leg In, Base Candles & Leg Out. The distal line is plotted at the lowest point of the entire formation. Distal Line For RBR Demand Zone We need to ignore the Leg In and focus only on the Base candles and the Leg Out. The distal line is plotted at the lowest point of either the Base candles or the Leg Out, whichever is lower. How to Draw Proximal and Distal Lines for a Supply Zone A Supply zone is a designated area on a chart where Supply exceeds Demand, and there is a high likelihood of having pending Institutional Sell Orders. We look to enter Short trades when the price retraces back to the supply zone, in doing so we also participate along with the Institutions which increases the probability of the trade working on our favour. So it's important to correctly identify the Proximal line and Distal line of a Supply Zone. Let u see how to mark the Proximal and Distal lines of a Supply Zone Proximal Line Marking For A Supply Zone Irrespective of whether it’s an RBD or DBD Supply zone, the proximal line marking method remains the same. There are multiple ways to mark proximal lines, I will discuss the one that I follow and is widely used. While marking the proximal line we look at only the Base Candles, Proximal line is plotted at the Lowest Wick of the base candles. Distal Line Marking For A Supply Zone There is a slight variation while marking distal lines, depending upon whether it’s an RBD or DBD Supply Zone Distal Line For RBD Supply Zone We need to consider all three components, Leg In, Base Candles & Leg Out. Distal line is plotted at the highest point of the entire formation. Distal Line For DBD Supply Zone We need to ignore the Leg In, focus only on the Base candles and the Leg Out. Distal line is plotted at the Highest point of either the Base candles or the Leg Out, whichever is Higher. Conclusion In conclusion, the Proximal and Distal lines are critical components of the Supply and Demand Trading Strategy. Knowing how to properly place them is essential for the correct identification of zones. Supply and Demand Zone formations when combined with other factors like Trend, Location, and Quality attributes of the zone form a very sound rule-based Price Action Trading Strategy.
NSE:HDFCBANKEducation
by MAKTradingSchool
13
Price Action Trading Using Supply & Demand ZonesSupply and Demand Trading Strategy is a price action strategy that focuses on identifying Institutional Buying & Selling Footprints on a Price Chart. This strategy doesn’t rely on any indicators or oscillators; entire focus is on Price Action. Owing to the sheer large size of their orders, Institutional buying or selling leaves behind certain footprints which create specific chart patterns. Price Action Trading Methodology relies on a vast number of Price Patterns, however Supply Demand Trading Methodology focuses only 4 Specific Price Formations. These are classified as Supply & Demand Zones. Supply & Demand Zones These zones are areas on a price chart where price in the past had spent very little time and had moved in an explosive manner. Such sharp moves in price is possible only because of Institutional buying or selling. Owing to the structure of these zones, there is a very high likelihood of having unfilled institutional orders in any zone. Demand Zone Formations Rally-Base-Rally (RBR) A Rally- Base- Rally is a price action pattern that represents the formation of a Demand Zone. It is generally found in strong uptrends, indicating a continuation of the uptrend. This type of pattern is characterized by a leg-in candle followed by a basing of candlesticks and then another Big Explosive leg-out candle. If you look at the leg out candle created in the chart below, it shows a strong vertical rally which is very likely due to institutional buying activity. Drop-Base-Rally (DBR) A Drop-Base-Rally is a formation that represents another Demand Zone pattern. It is a reversal formation, in which a drop is followed by a sideways price movement and then a strong bullish rally. The leg out candle ideally should be a big explosive move which will depict institutional buying activity. Supply Zone Formations Drop-Base-Drop (DBD) Drop-Base-Drop is a price action pattern that represents a Supply zone. A bearish drop followed by a basing or sideways price movement and then an explosive bearish continuation downwards. It is a continuation pattern which can be used to trade & participate in the down trend. Rally-Base-Drop (RBD) Rally-Base -Drop is a price action pattern that represents another supply zone. This formation is characterized by an upward move then a basing of candles and a strong explosive move downwards. Explosive drop after basing indicates the footprint of institutional selling activity. This formation is generally found at the end of an Uptrend signalling a reversal. Trade Action at Zones Supply & Demand trading methodology is a retracement strategy. Long trades can be initiated when price retraces to a Demand Zone & Short trades can be initiated when price retraces to a Supply Zone. However, all zone formations aren’t alike, one must qualify the zones based on factors like how Explosive was the move from the zone, how much time price spent in the zone & most importantly what Reward to Risk Ratios do they zones provide. These zone formations combined with Trend, Location & Multiple Time Frame Analysis lays down the ground rules for Supply Demand Trading.
NSE:ASHOKLEYEducation
by MAKTradingSchool
2