📍 What is a demand zone?
It is a price area where strong buying power appeared, causing the price to rise sharply, and usually, the price returns to test it later as potential support.
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🔍 How to identify demand zones (from the image):
1️⃣ Demand 1:
· After the price drops, a small red candle appears followed by a long green candle (buying power).
· The area is defined between the low of the red candle and the low of the green candle.
· When the price returns to this area, it often bounces back up (buy opportunity).
2️⃣ Demand 2:
· After a downward movement (covering imbalance), a similar pattern forms: a red candle followed by a strong green candle.
· When this area is tested later, the price bounces back again.
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⚡ What is imbalance?
· Very fast price movement (gap or long candles without correction).
· Indicates weakness of liquidity at this level, causing the price to return later to 'cover' the area.
· In the image: the vertical arrow in the middle shows a rapid downward movement (imbalance), followed by the price returning later to test demand zones.
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📌 Summary of the trading strategy:
✔ Entering a buy: when the price returns to a previous demand zone with confirmation (like a bullish candle).
✔ Stop Loss: below the demand zone.
✔ Target (Take Profit): at the next resistance or supply area.
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🎯 Why do these areas work?
· Large traders leave buy orders at these levels.
· The market tends to repeat behavior at strong demand/supply areas.
#Price_Analysis #priceaction #Trading #شموع_يابانية #Support_and_Resistance
