Supply and Demand Trading Strategy:

This strategy focuses on identifying areas on a chart where the price moves sharply either up or down — these areas are called Supply Zones (selling pressure) and Demand Zones (buying pressure). These zones mark where big institutions likely placed large orders.#BTCvsMarkets $BTC

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Types of Setups (as shown in your image):

1. Rally-Base-Drop (RBD):

Price rallies up

Forms a base (sideways movement)

Then sharply drops

Supply Zone is created

When price comes back to this zone, look for a sell opportunity

2. Drop-Base-Rally (DBR):

Price drops down

Forms a base

Then rallies up

Demand Zone is created

When price returns to this zone, look for a buying opportunity

3. Rally-Base-Rally (RBR):

Price rallies up

Forms a base

Rallies up again

Confirms a Demand Zone

Good to buy on a pullback to this base

4. Drop-Base-Drop (DBD):

Price drops

Forms a base

Drops again

Confirms a Supply Zone

Good to sell on a pullback to this base

Entry-Exit Rules:

Entry: When price returns to the Supply or Demand Zone

Confirmation: Look for price action signals like rejection wicks, engulfing candles, or pin bars.

Stop Loss: Place a stop slightly above the Supply Zone for sells, or slightly below the Demand Zone for buys.

Target: First target can be the recent swing high or swing low.

Tips to Trade This Strategy:

Identify zones on higher timeframes (1H, 4H, Daily)

Look for entry confirmations on lower timeframes (5min, 15min)

Focus on zones created by strong breakouts or sharp price moves

Avoid weak or sideways zones