this is Supply and this is demand and these are three insane tricks I'm going to be sharing with you including this trick that'll make your zones three times more accurate supply and demand one of the most important subjects to understand in trading even the kids are talking about it these days dude have you heard of that new supply and demand stuff yeah dude that is awesome but there's a good reason for that everybody's talking about it because of how well it works so who better to make a video on it than your good old pal
trading lab I'm gonna be showing you how to draw zones correctly what to look for how to enter how to exit and of course I'm gonna give you some secrets on how I improve the performance of my supply and demand Zone basically a full in-depth guide on supply and demand absolutely for free that way you don't have to go to a scammy website like read profit4you.net and download their free ebook just to get a virus on your computer oh [Music] enough with all the intro stuff let's get into that juicy finger looking good value so
what is supply and what is demand Supply is an area where price had aggressive selling and demanded a scenario where price had aggressive buying so Supply going down demand going up but one of the very key important factors of supply and demand is that the move has to be aggressive so for example here this move would not be considered an area of demand sure you have a decently sized green candle right here but this wouldn't be considered enough to be an area of demand what we are looking for is aggressive buying like I'm talking moms
on Black Friday why are you so for example here you can see from this point on there was extreme buying once price hit this area so once price hit the Zone there was aggressive buying as you can see from this price action right here this would be considered a successful demand zone so recap you need aggressive buying or selling in order for it to be a good Zone if it's just a couple candles moving up or down it's not considered a supply and demand Zone let's move on how to draw these zones correctly then I'll
give you a secret trick to make them more accurate so there are many ways to draw supply and demand Zone everybody has their own way of doing it this is just how I personally do it as I've seen the best results with this method here we have our chart and as you can see we did step one and found some aggressive buying how I like to draw my demand zones is find the opposite colored candle before the aggressive move so since this is a large aggressive upwards move we are going to draw a demand zone
so what we want to do is find the red candle right before the aggressive buying which is right here then you want to draw your area from the height of the candle so from the low to the high of the candle this is your demand Zone isn't it beautiful here's an example we found for Supply here we have aggressive selling so we find the green candle right before the Big Move draw an area from a low to the high of the candle this is our supply Zone pretty simple so that's the easy part the easy
part is drawing the areas but not all of these areas that we draw are going to be good areas actually most of them are going to be invalid areas this is how you decipher a valid area from an invalid area but before that have you tried anger trade is one of my favorite Brokers of all time because of these reasons some of the absolute lowest fees on the market their spreads go as low as 0.0 Pips and if you're an absolute Maniac you can use up to 500 x leverage with them 500 X they also
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here we have an aggressive downwards move so we follow the steps I told you before and make our supply Zone next we need price to break this structure right here which it does which means this zone is now validated and we can trade based on in this example we again have an aggressive downwards move but this time it does not break the structure so this zone is not validated and we would not trade off of it it needs to have both an aggressive move and have a break of structure to be of balance own just
as a little tip my private indicator automatically displays all breakup structures for you automatically all you have to do is go to the settings scroll down to Smart money Concepts and enable BOS this will automatically display all the main breakup structures for you so you don't have to mark them yourself it'll save you a lot of time and will also only display the main structures so you don't accidentally Mark the wrong one if you want to check out the indicator you can go to tradinglab.ai or I'll put a link in the description so moving forward
in this video I'm going to be using the private indicator to display my breakup structures for me so now that we know the criteria of a valid supply and demand Zone let's move on to how to actually enter and exit based off that criteria then we'll go over that secret juicy trick to improve your zones to make them spectacular so here we have aggressive upwards buying we have a big movement so that's step one complete during this big movement there is a break of structure as we can see from the indicator that step two complete
so we draw our Zone from the previous red candle now this is how you would do your entry and exit you are going to enter as soon as price comes back down to the zone you are going to set your stop loss right below this Zone and you're gonna set your take profit at the high of the upwards move so you'd set your take profit right here as you can see we have a great risk to reward ratio and the trade instantly hits our valid demand Zone and skyrockets to our take profit for an easy
W let's do a supply example and then we'll go over the secret trick here we have aggressive selling while this aggressive selling was happening the indicator says there is a breakup structure so we're good there we Mark a supply Zone at the green candle right before the move wait for price to come up to the Zone enter here set your stop loss right above the zone and set your take profit at the low of the move and just like that we have a nice and easy trade now it's officially time for the secret tricks to
improve the strategy even more these tricks will significantly improve your supply and demand Zone first trick you want price to slowly approach your supplier demand zone for example if price goes up aggressively and you draw your demand Zone like normal you want price to slowly come down to that demand Zone when it Returns the slower and the more steady the better if price returns to your Zone like this in a very aggressive and sharp manner you would not enter into this trade you want price to slowly come down to your Zone this tip in itself
is a game changer tip two you want a fair value Gap at the beginning of the move so remember how I told you you mark your Zone off the previous candle before the big aggressive move you want a fair value Gap connected to that candle so here you can see price jumped up super fast after this candle and created an imbalance right here this is exactly what we want if this happens it'll improve the chance of your zones working even more if something like this happens when price just slowly creeps up after the candle this
would not be good The Zone still might work but it has a way higher chance of working if it has a fair value Gap like this example also as a quick hint my private indicator displays fair value gaps for you just go to the settings scroll down to Smart money Concepts and enable fair value gaps the green rectangles are bullish fair value gaps the red rectangles are bearish fair value Gap so a good example of what you're looking for is where the fair value Gap is displayed by this rectangle and it's connected to the very
first candle of the zone so quick recap of the perfect supply and demand trade first you want a strong aggressive move the move must be aggressive this is very important during this aggressive move it should have made a break of structure displayed by the indicator like it did here you should have also created a fair value Gap during this move connected to the very first handle like it did here displayed by the indicator with this rectangle we then want price to slowly come back down to the zone no sharp movements nice and slow once it
comes back down to the Zone enter here set your stop loss below the Zone say your take profit at the high of the move and just like that you have a perfect trade I made this video because I posted a Discord announcement saying if this post got a hundred emotes I would make this video for absolutely free let's just say it got a little more than 100 emo if you want more trading tips and strategies like this join my Discord for more trading tips I'll leave a link in the description it's also a very cool
place to just talk to other like-minded Traders thanks for watching and I'll see you guys next time yeah dude that is awesome
