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