Transcription
[Music]
Hello traders,
I hope you have a profitable week! In this video, we are going to break down our premium setup: Euro Australian Dollar. We are going to use supply and demand principles, support and resistance, and volume profile. You are going to learn when to find these sniper entry levels.
It's very important to focus on a few setups during the week. This will give you better results because one of the most important reasons that traders lose money is poor management of their trades. Fewer trades are managed more effectively.
Let's begin with our premium setup. We are going to highlight the supply zone on the four-hour time frame. Price rejected this level exactly at the edge of this supply and then dropped in the downside direction.
We are going to draw the demand zone that is located at the bottom. This is a fresh demand zone, and price hasn't touched it yet. If we look at the right of the chart, where the volume profile is located, we notice the increase in volume. These factors indicate sensitivity in this zone.
We are marking other value areas that will serve as our target if we enter a buy trade. We are shifting onto our time frame; price is touching a support level now. We are highlighting the demand zone on the two-hour time frame that is located inside the bigger one.
Buying at support is very good, but we should keep in mind other factors too. In this case, we have that demand zone below this support that serves as a magnet for price. If we enter at support, our rational stop loss should be below the major demand zone. The risk-reward will be 1.81, which is not bad, but we can do better.
I said rational stop loss because you can use the tighter one, but watching the structure of the chart, I will not suggest that.
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The best option we chose on the premium channel was at the demand zone. We had more correlation, and this could offer better risk-reward than the first one. As we see, price broke the support level and reached our entry zone at demand, then bounced in the upside direction as we expected.
Hypothetically, if you entered at support with a tight stop loss, the results could have been a lost trade, and then you blame the market. Remember, the market is always right. Don't forget that we should adapt to it, review your trades, and learn what was wrong.
Support and resistance is a powerful strategy, but in this setup, other confluences indicate us not to enter at this level but at the demand zone. As I mentioned, price bounced in the upside direction.
Our final target was near the third value area. Price did the pullback when it reached the point of control. At this moment, we suggest moving the stop loss to the entry level and optionally a partial close of the position.
You must control your emotions and watch the chart with objectivity. Price is resting at a new support level and has higher chances of reaching our target after a consolidation.
For a while, price bounced again and reached the target as we expected. We saw a quick reaction after this touch because this level correlates with the third value area mentioned before and the new supply zone.
If you want to learn more about our trading style, we offer a mentorship program.