How to trade currencies as a supply and demand trader as banks do

Hi, Readers.

I hope you all are enjoying your trading as Usd/cad really giving us more than what we first anticipated & now it turns of the U.S dollars bulls to final lay down.

Let's putting the trade & setups Aside & talk about the potential to grow your trading skills. I've been asked numerous time that How I manage to get that much out of my trading with just 10-15 pips stop & Riding the reversals and continuation of trend.

So, In order to answer this, I would like to reply with just one 'quote' which is experience & know what is happening on the chart. You ever realize trading a 5 minute chart with ticks & getting 10-20 pips in session is what banks do in order to liquidate market.

So, If you don't believe one thing which is how does the market move that much in 'Active' Trading hours. That is what banks and institutions been doing all the time. If they never participate in trading then Market might keep moving in another direction,unless and untill there are opposite orders & this happens everyday.

Now the Question Here Arise is :-

How does banks, institutions, hedge funds & other Financial Institutions trade

That's truly the reason to believe that how does large institutions, banks and other financial institutions trade & Why can't they trade against each other and try to be on top. Let's make one thing clear which is that they trade in one direction & never do participate at once as there are always one at the top & left clues on the chart where it would leave & when there is enough orders to liquidate and re-enter before continuation or reversals.

If you want to know how they do, then bookmark this post & keep looking everyday for next one month to see If there is something of 'Value', you get to know and we should start with a chart of Gbp/nzd & usd/chf today when U.S market close.

First of all, I would look into the Usd/chf Chart, where I will point out three back to back trading opportunity and forth one around these levels from 0.9870 -0.9950 & when this will happen, I would be first one to update the chart. All these opportunities were sell big time, either it was pending sell orders or retest with strong conviction & compression to revisit demand again.

First of all , look at the left shoulder Area, It could be Drop base really after engulf & Could be QM level special when a strong break followed by failed retest Level.

2. Whenever you see failed Retest level look to tighten your screws & always look for approach & lined up trade on any time frame.

3. Most Important point to note here is, It could be a strong historical level turned into Left Should of 'head & shoulder' family where Banks & institutions have pending orders before next move to the source or target.

4. Next level to watch out for is (If it is a Dbr after engulf, low of base level If at all there is a trick played there. Suppose if high or left of the shoulder is way to strong level to approach , If the move after break and retest is very strong, then probably base of that level is test with conviction and a new Flag is created below that level.

5. I would should you all these steps level by level & Surely that study is going to continue for months to come & You should not miss it as couple of months will entirely change the way you trade & way should be trading in the next months & years to come.

Price Action follows a structure of broken & Retest Approach which is a sign of Weakness or strength when Approached

Price Action only tell us who is king & who is dominating the market . Bulls or Bears who have the edge .

No one can ever tell prior to move that who will dominate the market but structure is one good predominant clue of what market is above to do when approach. e.g Price following a structure of broken support and retest in the following chart.

But when last support was broken , banks plays a trick of failed retest and create a panic area which is so called 'Left shoulder' as mark with the blue line.

Market created a random fakeout after testing and failed at previous demand but market does not have enough force to retest the broken level again. So, it create a flag Just below the left should and engulf the drop base rally with conviction which was good enough to look out for opportunity to sell again at the left shoulder.

This structure is the easiest piece of Pie you can ever have. Market found structures failed rallies, Drop base drop & Candlesticks Traps after one another. But only most of them fail but those which works does not move an point or two higher when exactly predicted.

Stay tuned for another Chart Example & probably this one would be a live Trade .

Top down Analysis in Forex. Weekly to h4 . How to draw top magic levels from higher to lower time frames.

Hi, Readers ! Last time I updated my chart with two classic examples of Touch Trades . Now I'm hereby want to show you method that will completely change the way you trade. Exactly, I still wonder why stairing at charts for hours don't bring in the results.

Answer being the Approach. Approach to levels & emotions that you bring in with trading mechanical systems or Intraday Scalping. Somehow, they don't work. Not work for me, atleast !

Let's not waste more time & get back to the real motive of putting this blogpost. I am posting the Gbp/nzd chart below, which tell you the real story behind "Trading Levels". Levels that can be traded from higher to lower time frames. Price do tend to give us clues before approaching such levels and its our responsibility to check the weekly charts once after the close of Trading week.

Points you need to follow here are :-

Strong Weekly momentum Candle that goes through the previous Resistance with strong push.

Failed to carry the momentum & then after few weeks we saw a break below & then price try to get back above the low & rejected and collapse.

Price Return to that level but with the cautious approach.

Look down the DAily & H4 Chart to see the reason.

Price does compressed to the level

Take a look at the Daily & h4 Chart below. This charts give us clues why we are quite sure of the rejection from that level we market on weekly Chart.

Only thing you must keep in mind is to set your stops & see above if there is any area where you can put your stops & Set the targets to the low levels of rejection. It could be Rally base rally on h4 chart to take the profits.

I've marked those zones on the chart which can help you take decision to set your stops and profit targets

Support Resistance Flips are most common way to trap Retail Traders

We can clearly see the h4 chart in which I've market the support/resistance flip before approaching to that weekly zone. One more thing to notice is that prior to visit that flip there was strong sell-off which take carries price to recent lows & then price start with little compression to approach that Area. again

Price Visit the area after the flip but there was still room for rise & that is exactly what happened when price visit the area again. but that approach was unable to push the price through the resistance and price stalls near those levels and I took the entry just around that S/R flip & put the stops just above the h1 supply & still in the trade.

Price Does Everything here.

STrong Sell-off followed by S/R Flip.

visit the Area of importance & clear the demand again & then revisit the area and got rejected.

Update on 08 september 2019

I was just going through the charts for weekly setups and found out the recent Price Action in USD/chf Chart. Price is very hesitate to go pass 0.9900 and every time it goes pass the line, steep fall was seen & this time its no different but this time I expect price to be bit more aggressive to 0.9950 level.

Chart speak louder than words & this usd/chf Chart screaming for sell-off

Sorry for not using the regular MT4 platform as my platform is going through upgrade and don't have access to the platform.

I've market the zone below as demand which for me is still a fakeout of the demand and if this area is not tested again , then I would see only one area of concern, that is 0.9950.

I would like to make you feel comfortable in coming weeks and months by being more eleborative & explain things on charts that will help you trade naked charts & levels & I can promise you that you won't be using any indicators or any other mechanical systems in trading at all.

You must take not of few things :-

Every Price Action is reaction of previous price patterns.

Price don't randomly fake Demand & supply zones

If you see an area which is protected earlier with wicks & then engulfed with force, then You must look to see the areas where you can enter again. It could be level above the recent zone or small base followed by drop.

Price Usually compressed to those zones & pick every demand created there on & finally fall is very strong and you need to be proactive in setting targets and trailing entries.

PRice Action zones in usd/jpy sell stop ordesr around 106.45 l stops around 107.32

Take a brief look at the chart & set pending orders with stops around 106.82

Hi, Readers ! There is an update to the above Trade usd/jpy which I mentioned yesterday. Take your time in reading and understanding why I decide to give a bit more to my recent trade of Usd/jpy. Its totally advised that You extend your risk based on your account equity & be decisive and flexible to your approach in your trading, otherwise this market can react anytime without any due reason.

I would like to update you on my recent setups of usd/jpy which I update yesterday. I still think the trade is of high probability but as we see immense liquidity in Asian session really give bulls an upper hand but rejection near the area of 106.78 is still quite demanding. Are we still over reacting to the recent rise and falls in japanese pairs. e.g Cad/jpy .

Canadian banks does not change in overall benchmark interest rate of 1.75% which strongly push Canadian dollars to recent lows after we make bundle of pips in our usd/cad pair. Take a look at the Chart here. I am still quite reluctant to what I post but the difference in the approach and setup is quite different from yesterday chart. I'm still looking for complete long term position in usd/jpy.

I would enter one more lot around 106.80 area & then put the stops around 107.32 & look to close first lot around 105.70 & let the rest trail around 106.00 area, & see if price would breach the recent lows of 104.45 & then I would target 102.50 area to close my second position.

Decisive approach in trading is only thing we need to watch out for

You all know, I always try to trade with the edge. So, where do I look for price Action is the nearest support and resistance and the approach and reaction towards those areas. Price has already react a lot to the broken support which in this case must be breached but the last reaction and recent price action of h4 candle which has just closed looking quite reluctant even though push is quite strong from the yesterday's close. If that is the case, then why didn't price manage to breach those levels.

Reason NO. 1 > NFP week. We do see usd/jpy pair react quite volatile to the release of Non-Farm-payroll & tomorrow is the day of NFP & direct relation with usd bond yields usd/jpy reaction to nearest support resistance is quite understandable. But why these areas are so strong that price do scare to react. Reason being Retail traders.

Retail traders put stop orders near those areas and price needs to have enough liquidity to take those orders and react. But even last rejection and order accumulation was quite strong to test the previous swing low which is strong rally and series or rejections tell everyone that there are bundle of stop sell orders just above the recent high and after taking out those sell orders. Price will continue to fall & that is the reason I see those orders around 107.20 area.

Price Action do collect lot of sell-buy orders as marked with blue lines & that is the reason why I always think of the reason behind those moves. Not enough liquidity is the first reason that come to my mind or pending release is the another . Ever Price Action area is a reaction of previous action. IF there is no earlier or clues of reaction price won't move and will going in one side & that is the reason why Forex market is one of the best market based on what you can look to adapt and transform your trading skills and be a professional . This really does not happen in stock market at all. Reason being the closing and opening gaps, overreaction to news & unless you are big Tech giants like Apple or Google. You share price will have an edge as compare to other stocks.

Concept of Trend Trading In Forex

I've put my whole hearted effort in spotting opportunities and present it amongst all my readers. In the below Post I would like to explain you the concept of trend trading and how you can spot opportunities like these. These type of opportunities are very high probability ones and if the below demand buckets are filled these rejection goes right to the next demand or supply level vice-e-versa.

Chart of Aud/cad speaks all in itself. Price got rejected. Either it CP'ed (compressed) to the previous broken support or faking out the demand before hitting supply & then travel right way through that demand for new move.

There are few points I would like to point out here which are

1. Price must have some sort of history prior to testing the broken level

2. Price must have pick all the opposite orders or compressed into the zone.

3. One high probability one is that broken support must have become the base specially if it is a strong one like Drop base drop and no panic buying at support.

4. If all the conditions are met and one is missing then you should look for QM level on smaller time frames and those QM's must become probable FTR. I would explain how to spot these type of opportunities in detail in coming days and weeks.

Stay well, trade well . See you on the other side of NFP release and TRade outcome will be updated on Monday.

usd cad Price Action . Price is reacting to old supply and demand zones.

Usd/cad chart posted here. Price action is quite subdued by filling demand buckets and reacting to upper supply zones and then falling very seriously. Previously stated price is tend to resume or are we seeing a big rally to upwards.

My idea is that we should see the approach first to react to 1.3370-80 zone area & then I'll update the post for possible target zone if there is new zone created of demand when it breach the recent high. Then we will possibly see that short term rally is eyeing multi month top & we should only look to trade to long opportunities.

But As I said, Its totally on the approach, when price leave that zone and then reaction to reach to upper supply zone created and that fall is very strong and I would possibly recommend shorting around that zone and then target 1.3210 area with stops around 1.3410 area. Offering very good Risk to Reward opportunity in sight.

Usd/cad supply and demand zones clearly marked on the chart

Update on 03rd September 2019

Look at the Chart Above & below. Aren't they same. IS the price Action clues of rejection from true FTR of the Flag.

There is still room for more rejection & I would surely update the chart in real time, when that opportunity arrives. Stay Short Usd/cad

Is this market really fundamentally driven ?

I've seen market takes turn based on what big players are focusing. Federation and Trump & OPEC, people with big guns turns the market at will. How long is it going to stay or is it going to stay like it is ?

Can we see banks following the market & turning the table with strong rate cuts & Show off their economies the right way. Well ! New zealand bank did exactly the same way and that was the best volatility for New zealand pair and Crude oil inventories as that create panic amongst central banks of global slowdown.

Same can be expected from Bank of Canada.

Market is not expecting any rate cut at this time of the year but this market is full of surprises and this will be the another one and we could usd/cad take lead and rest follows as well. I'll surely keep an eye on that as this for me is the biggest event of the week after what KIwi banks did.

Brexit deal, sterling & trading levels

Brexit deal or NO-deal is currently on the cards sooner or later and that is the reason why sterling is so much range bound ahead of any news coming out of camp & also we see strong movement but in range and as everyone is expecting pound to recover, I don't agree with anyone specifically on the short term, as I see big orders around again at 1.2220 area & I would surely look to ride that area.