I picked this demand zone out to go long on Ripple. There's an obvious up-trend, to get in try to find a demand zone below current price. The zone can't be violated;meaning, price can't go past the zone and then rise again (that would mean the orders/demand there has already been traded). To check, drop down from current price to the price of demand, and move left until hitting the zone. If there are candles at that price between the zone and the current time, then that zone shouldn't be used.
The yellows hands point to potential demand zones, since they are pivot points and haven't been violated, but in this time frame there aren't any candles with small bodies and large wicks (price moved too fast). In a lower time frame, there might be one present hiding inside those big candles, but that is riskier and less likely to complete in the current up-trend.
Since I am trying to get into Ripple at this point in time, I'm picking this demand zone with the perfect candle base just below the current price. There is a high likelihood that price will drop here because it's so close, that price will reflect off due to buyer demand. This candle also appeared on the 1 hour chart, which is stronger than the typical 15 min that I usually use for day trading, and better for getting into and out of positions.
This trading technique works on all time frames for all asset classes, as long as the price action is drawn from the mechanics of supply and demand, buying and selling.
Here is more information on zones so I don't have to retype this every time and everyone reading can be on the same page.
The small candle with long wicks in between 2 big candles is the definition of a zone. Since the price line of the zone is lower than than current price, it's a demand zone . Demand zones are when the price is so low/high that enough buying interest is present to produce a higher likelihood of price increasing--similar to a line of support, but defined by price action rather than shape.
To take advantage of a demand zone, place limit buys at the top if you expect price to go long in the medium term.
This accomplishes several objectives:
buying low/aiming for a cheap price
being contrarian, buying after lots of selling
staying patient, price has to drop short term before willing to buy
placing an order at a price with a history of fast moves (orders not filled and left over)
aligning with big money and their price levels (take advantage of large fast moves)
The yellows hands point to potential demand zones, since they are pivot points and haven't been violated, but in this time frame there aren't any candles with small bodies and large wicks (price moved too fast). In a lower time frame, there might be one present hiding inside those big candles, but that is riskier and less likely to complete in the current up-trend.
Since I am trying to get into Ripple at this point in time, I'm picking this demand zone with the perfect candle base just below the current price. There is a high likelihood that price will drop here because it's so close, that price will reflect off due to buyer demand. This candle also appeared on the 1 hour chart, which is stronger than the typical 15 min that I usually use for day trading, and better for getting into and out of positions.
This trading technique works on all time frames for all asset classes, as long as the price action is drawn from the mechanics of supply and demand, buying and selling.
Here is more information on zones so I don't have to retype this every time and everyone reading can be on the same page.
The small candle with long wicks in between 2 big candles is the definition of a zone. Since the price line of the zone is lower than than current price, it's a demand zone . Demand zones are when the price is so low/high that enough buying interest is present to produce a higher likelihood of price increasing--similar to a line of support, but defined by price action rather than shape.
To take advantage of a demand zone, place limit buys at the top if you expect price to go long in the medium term.
This accomplishes several objectives:
buying low/aiming for a cheap price
being contrarian, buying after lots of selling
staying patient, price has to drop short term before willing to buy
placing an order at a price with a history of fast moves (orders not filled and left over)
aligning with big money and their price levels (take advantage of large fast moves)
