How do you draw supply and demand zones?

That’s the correct way to draw supply and demand zones: from the base – the small consolidation/pause before price moved away – to the most recent major swing high or low. For demand zones, draw from the base to the swing high. For supply zones, draw from the base to the swing low.

Is there a difference between supply & demand and S&D zones?

A: No, but they are similar. Support and resistance are price levels where price could reverse. Supply and demand, on the other hand, are price zones where price may reverse. It’s a slight difference, but a big one. Additionally, S&D zones form due to the institutions – banks, hedge funds – entering major trading positions.

What is a supply and demand trading strategy?

Supply and Demand trading strategies use price returning to these zones as entry and exit criteria. The strategy is market-neutral - meaning it can be traded in forex markets, commodity futures, index CFDs etc. What are zones in trading?

What is a demand zone?

Demand Zones form when the banks place a large number, or size, of buy positions. This creates excess demand, and results in the price reversing and moving higher. The point where price reverses is the demand zone. Historical Price Reversal: Demand zones often occur where price has previously reversed from a downtrend to an uptrend.