How to Trade Supply & Demand Zones

📉 SUPPLY ZONE TRADES (5370–5375)
🔴 Scenario 1: Reversal from Supply Zone
Price action: Price moves up near 5370–5375 and forms a bearish candle (e.g., Doji / Engulfing)

Trade Type: Short (Sell)

🛒 Entry: Around 5372
📉 Stop Loss: 5378 (above zone)
🎯 Target: 5330 (previous structure / 40-point move)
Risk Type: Medium
Rationale: Price faced rejection from the supply zone multiple times.

🔴 Scenario 2: Break & Fail Retest
Price action: Price breaks above 5375 but quickly falls back below it and retests from underneath.

Trade Type: Short (Sell on breakdown confirmation)

🛒 Entry: 5370 (after breakdown and retest)
📉 Stop Loss: 5380
🎯 Target: 5325
Risk Type: Medium
Rationale: Trap breakout buyers and trade the reversal.

📈 DEMAND ZONE TRADES (5302–5294.5)
🟢 Scenario 1: Reversal from Demand Zone
Price action: Price dips to 5300 zone, shows strong bullish reversal candle (e.g., hammer / bullish engulfing)

Trade Type: Long (Buy)

🛒 Entry: 5300
📉 Stop Loss: 5290
🎯 Target: 5345
Risk Type: Medium
Rationale: Clean bounce from a strong demand zone.

🟢 Scenario 2: Breakout and Retest of Demand
Price action: Price breaks below 5294.5 but recovers strongly and retests the zone from above.

Trade Type: Long (Buy on successful retest)

🛒 Entry: 5302
📉 Stop Loss: 5288
🎯 Target: 5350
Risk Type: Medium
Rationale: Demand flipped to support again with bullish confirmation.

Reversal trades from demand/supply zones can offer high risk-to-reward setups.
Always wait for strong price action confirmation like pin bars or engulfing candles.
Avoid jumping in blindly — volume and structure matter.
Use tight stop loss just outside the zone to manage risk smartly.
Ideal for range-bound markets — not during strong trends.

⚠️ Risk Management Tip: Always trade with a clearly defined stop loss. Avoid entering positions impulsively. It is advisable to start with a smaller quantity and increase your exposure only if the price action confirms the continuation of the trend. Capital protection should always be the priority.

📢 Disclaimer
This content is created purely for educational and informational purposes. It is not intended as investment advice, stock recommendations, or trading tips. Trading and investing in the stock market involves risk. Please consult with a SEBI-registered financial advisor before making any investment decisions. The author/creator is not registered with SEBI and shall not be held responsible for any losses incurred based on this information. Always do your own research and use proper risk management.

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