The 3 Step A+ Supply & Demand Strategy (That Actually Works)

Summary

The presenter describes a three-step supply-and-demand trading strategy for identifying long setups. He says he has used the concepts for 16 years and presents chart examples, including winning and losing trades. These are the presenter’s claims and demonstrations; they do not establish that the strategy will work for other traders.

Strategy framework

1. Identify a demand zone

   • Look for a strong upward move—illustrated as several large green candles—as evidence of substantial buying.
   • Mark the zone around the candle body before the sharp move. The presenter says this can make the zone tighter and focus on where most volume traded. For smaller candles, he may use the full wick range or group several candles into one zone.
   • Look for a fair value gap as a sign of imbalance, momentum, and trend confirmation.
   • Check for confluence, such as a prior resistance level that could act as support.

2. Confirm the trend

   • Map swing highs and lows; an uptrend is indicated by higher highs and higher lows.
   • Look for breaks of structure, where price takes out a prior swing high.
   • Alternatively, check whether price is above an exponential moving average (EMA) with clear separation, or whether there is an uptrend on a higher timeframe. The presenter cautions against trades when price repeatedly crosses the EMA without separating from it.

3. Wait for an entry trigger

   • Prefer a gradual pullback toward the zone rather than a large, fast candle into it.
   • Price must wick into or close within the zone. A candle closing below the demand zone invalidates the setup.
   • Enter after a positive reaction, illustrated by a green candle.
   • Place a stop loss at or below the zone; an earlier example also uses a prior wick and EMA as reference points.
   • Set a profit target using recent price levels or a risk–reward target. One example targeted 1.5R; other chart examples showed approximately 1.4R and 1.83R.

Six checks for demand-zone setups

• Prefer fresh, untested zones; the presenter says previously used zones may fail on a later retest.
• Treat a close below the zone as invalidation. A wick into or below it is presented as potentially acceptable if price closes back within the zone.
• Seek confluence, such as an EMA or a level that previously acted as resistance.
• Favor the lowest demand zone when multiple zones form; the presenter calls it the strongest.
• Seek a discounted entry: use a Fibonacci retracement of the swing and enter below the 50% level.
• Look for a break of structure; the presenter warns that a zone without one may fail.

Other methods, examples, and numbers

• The strategy is presented as applicable to forex, cryptocurrencies, futures, and gold. The presenter prefers the London and New York sessions, though he says it can be used in other sessions.
• He shows a 121-trade backtest with a claimed 79% win rate and P&L above 2,100%. He acknowledges that live trading is harder than backtesting.
• A separate example uses a five-minute trailing stop: the presenter exits after a candle closes below the indicator line and reports a $1,428 profit.
• For an opening-range breakout example, he marks the high and low of the first three five-minute candles after the 9:30 a.m. Eastern open, then waits for a candle to break and close outside the range. He combines that confirmation with a pullback to demand and a positive reaction.
• The video also shows a losing setup: price returned to a demand zone after a large downward move and hit the stop loss. The presenter acknowledges that losses are part of trading.
• One illustrative trade is described as targeting about $1,000, and another live trade as targeting around $1,300. These are chart examples, not stated performance guarantees.

Cautions and disclosures

The presenter says he does not promise or guarantee future results. He acknowledges that the backtest may not reflect the difficulty of live trading and demonstrates a losing trade. He also promotes TripleA AFX as his broker, citing low spreads and commissions; that is his endorsement, not independently verified here. No specific ticker symbols or individual securities are named.

Presenter/source: Pat, from Trade with Pat; he also refers to a live-stream trade shown to his students.