one level i will be watching in the market tonight will be to go long in the gbp/usd around 5723, stop around 5695 - 28 pips.
target 5755 - 32 pips.
Not advising anyone to take this. trade at your own risk. you could lose all your trading capital on any given trade. trading is risky and never guaranteeed
Hi Jay
Just wanted to say Thank You for all the effort you have put into this thread. As someone still striving for consistency I really appreciate the videos and information you have provided.
Russ
Russ, thanks for your input, appreciate it. Feel free to ask any questions, post any charts, or give any critique or suggestion.
Jay
HI jay!
Could you kindly elaborate what you meant by empty space?
Would that mean you would draw your SD areas as tight as possible without leaving any empty space in between? thanks.
Learning and still learning till now…
I think those are empty areas without any price action.
Yes, Pippard is correct…empty space is an area where there is no price action.
A supply zone is a zone above current price, marked on a price chart by two horizontal lines. Between those lines is a “supply zone”: ie - a price range on a chart where there is a high probability of having many more sell orders in that price range than buy orders.
So, the highest line (top line) will be drawn from the swing high. It usually only touches the highest point, and there may be “empty space” (areas where there is no price action) immediately below it.
However, the lowest line (bottom line) of that same supply zone should be drawn exactly where one of the candles in that “supply zone” ends… at the bottom of whichever candle ends first as you move from the swing high of that zone down, pip by pip.
A demand zone is just the opposite of this. The lower border (lower line) of a demand zone may have empty space above it, but the top line on a demand zone should basically cut through all price action… no empty space below it.
The picture I posted above illusturates this pretty well I believe. Thanks for the questions, keep em’ coming.
Jay
thanks jay! That was good explanation!
Hi Jay,
I have watched all 7 of your videos (in order) and just wanted to say thay a big thank you to you. They were most fascinating.
It would be particularly useful for myself and many other traders, if you could release a few more giving examples of other potential setups and your thought process as to why you are taking them and also your MM and exit strategies (I believe you alluded to this in one of the later videos).
Anyway keep up the good work and please keep posting!!!
Thanks for the interest Mickey… to be honest, this type of setup that i show here is probably one of the best to show, as it doesn’t require much (IMO) experience to start working with, and provides a high enough success rate for most to be satisfied with trading it.
Other setups and trades I take do not have such clearly defined rules…as they are more situationally dependent, and discussing them would only increase confusion for all but the few very experienced traders. it would be very very easy to misapply the reasons for an entry i take in one market at one time, to another market at another time…missing some sort of subtle reason as to why the first trade i took was good.
Also, I do a little private mentoring on the side, and I would be doing both them and others a bit of an unfairness by discussing every component to my other setups. Besides… without some real one-on-one attention in a realtime situation, over a series of weeks/months, it would be unlikely to benefit the vast majority. Not really things I can boil down to a basic “paint by numbers” list.
I made these videos because I think, these concepts are the closest i could find to create a fairly mechanical, easy to learn process for anyone willing to spend the time applying them.
AND, they are enough to make an extremely good income per year when executed properly. I’m gonna go out on a limb here and say 1 - 3% per week is quite doable with the information provided within.
So, it’s the most straightfoward, easiest to apply without failure, and gives one all the money making potential that most would want to make a full time living trading the markets.
I will discuss some money management concepts…but i’ve found money management to be a very personal issue. one needs to find what works for THEM… not just what works. But, I will bring some of these concepts up in a general sense over the next few weeks. Some I find very helpful in my own trading. Money managment, in many ways, is a major “key” to success, and I will discuss some of that here.
What I really would like, is for some folks out in babypips land to post up some examples of trades they are taking based on some, or all of the principles i outline in the videos. There is plenty to pick apart there, and I’d love to give some feedback based on these ideas.
Hope this clears things up!
P.S. For more setups… i would recommend ICT’s thread here on baby pips. His students seem to be doing quite well with his stuff when they take a disciplined, patient approach to them. I can personally say that his methodology will yeild nice profits when mastered and applied consistently.
A question about the weekly relative supply and demand curve. I’ve been trying to utilize this per your videos and per ICT. I really like having these zones, and also having some type of indication (I like color coded arrows) of the three session (Asian, Europe, NY) highs and lows each day. I find that combining gives me a great feel for where I can reasobably expect support and resistance. My question is that both yourself and ICT create zones based on the prior week. I’m finding that conditions tend to change from day to day at times when the market trends - apologies if that is a silly statement. Had you ever considered creating zones using the prior two or prior three days? As a pro, do you think this would result in better zones, or is there a reason why you do not. It seems that trading on Wed’s and Thursdays would be helped by factoring in the more recent S/R. Kind Thanks
Jay,
First, many thanks for taking the trouble to lay out your method like this.
I am reading through your thread and watching all your videos, trying to make sure I understand all this completely. However, I’d be grateful if you could explain the sentences I’ve quoted. I’d like to pin down exactly what to look for and draw in for other opportunities, but my present reading of what you said is a bit vague.
Are you saying that the yellow lines show the upper and lower bounds of a supply zone, as it shows up on a daily chart? Are you saying that the purple line marks the open price of the first hourly candle within the supply zone?
Cheers, Pajo.
Hey Jay,
Thanks for taking the time and effort with the videos…both you & ICT are incredibly generous.
I too am in a little need of some handholding while I attempt to identify these supply & demand zones.
I have here a USDCAD daily chart where I’ve drawn a consolidation zone, above the bottom support/demand zone, which I am inclined to think would be a good candidate to also call a demand zone because of the way price shot up out of it? Would you be looking at it as such?
So now price has returned to it and it’s also the 61.8% fib zone of the very low to high range and I’m thinking this is a good candidate to look for some kind of move back up again? Would you, or what would your assessment be otherwise? I know there’s more to what you go through to determine a trade candidate, but I’m just working on identifying the areas first.
Thanks 
Hog… thanks for stopping by. I do know that some who follow ICT use a few previous days, and I have seen him mention that the 3 prior days are of importance. For myself, the weekly relative sup/dem curve provides me a gauge as to where i would prefer to be buying, and where i would prefer to be selling. I don’t use it as S/R. Not to get into an argument of semantics, but I view the high of the weekly relative sup/dem curve as “overbought” rather than “support”, and visa versa.
I focus primarily on tight zones of price consolidation at a market turning point, ie: supply and demand zones as my primary areas of “support and resistance”
the weekly relative curve just shows me at what range of prices I should be looking to trade my supply zones over my demand zones, or my demand zones over my supply zones.
What your saying makes sense however… but anything other than price and levels derived specifically from price are secondary, supporting considerations for me, and this includes anything fibs, pivot points, and the like.
Jay
Pajo, I draw my my daily zones first… based on how i showed in the videos, and also how I have posted up on some of the more recent pages on this thread. Once I have those levels…i zoom into it on a 1 hr chart, and repeat the same thing on any 1 hr levels i find WITHIN the daily level (zone)
essentially, there are tight areas where price consolidates or stalls before making a move up or down on a 1 hr time frame all over the place, but I want to focus on those 1 hr areas that fall within the daily areas.
so, draw them essentially the same as you would the daily sup/dem levels 
Jay
Thanks. I think I had figured this out just now anyway. After a second run through the videos I realised that you do the same exercise at two scales, which I take to be what you mean about stacking probabilities in your favour.
Sweet Pip…thanks for the kind words! ICT has definately set a nice standard here for providing new traders a profitable approach to market analysis. I hope this thread delivers a similar result.
Anyway, the way I would draw the “demand zone” as I illustrated in the videos would be, in this case, to focus only on the daily candle formed on sept 16th. Take the entire length of the candle, including the wicks. THIS is your “virgin daily level”
Vigin is important! You want a daily level that has had no retracement since price left the level.
Check back i think to the last page or so i this thread, and you’ll see that when drawing a demand or supply zone, I don’t want to see any “empty space”. If i’m understanding your drawing correctly, your zone as draw contains quite a bit of “empty space”. (an area where no price action took place)
here’s a pic of the nearest virigin daily demand level is.
Uploaded with ImageShack.us
The demand level is between the two red horizonal lines.
Jay
Jay,
Regarding the above chart, according to the actionforex website, the monthly/weekly s1 pivot points are 0.9987/0.9988 respectively, putting them outside your daily demand zone. Knowing that would you still trade this?
Also just for the sake of clarity could you draw where you would now put your weekly relative curve on this chart.
Many thanks.
Mickey, I likely would. The basis for this entire setup is a fresh daily sup/dem zone. Everything else is just about finding where within that zone is the most likely place for price to turn at.
Statistically speaking, a clearly developed, fresh daily zone provides the overwhelming bulk of the edge in this approach. As in, depending on how one defines it and what market it is applied in, the results are between 70%-85% that these levels provide a price reaction in which the market turns around and exits the level by just as many pips as it entered the level, and many more in most cases.
however, you can’t just take an entire 100 pip daily level and trade the whole thing for 3:1, or even 1:1. Well, maybe you can, but you will have no where near an 70%-85% success rate. Probably closer to 50-55% at 1:1
So, you know a profitable turn is 70%+ likely, if only you could narrow 100 pips down to a zone of about 25 pips.
So, monthly/weekly pivots may provide clues as to exactly where in the zone i should enter. by pinpointing my entry down to a risk of 10 - 35 pips, i greatly increase both the probability of hitting my final target, and the rate of return i can get when i do hit it.
And for the record…daily pivot, S1, S2, and S3, as well as monthly and weekly pivot, S2, S3 are all good for this. not JUST S1
Just a quick note ~ caught up on all 7 videos; things make sense. Especially like the commentary about the S1 / R1 probabilities across several years.
A new week is soon to begin, though quite a busy one; going to see if I can apply some of these concepts and see where the trades would go. Not even on demo, just conceptually at first to see how things unfold. Even a 5% or 6% ‘edge’ in forex is enough to make anyone quite wealthy… this is going to be interesting to see!