Good afternoon (again)
Sorry to bombard you with questions; but I also like to refer to the weekly timeframe – however like one of my previous questions, how long would you say is appropriate to trade a weekly zone before it is not valid anymore?
I look forward to your reply.
Regards
My Response:
Let’s clear up some confusion about the time rules related to supply and demand zones…
While they’re a good guideline, they’re not set in stone.
Some zones, although old, remain valid for trading due to their market significance. The problem is… teaching how to differentiate between valid and invalid old zones isn’t easy.
The reasons which might render one old zone valid might not apply to another—there’s no one-size-fits-all approach.
If it adds clarity, consider this: in the case of a consolidation, like we’ve seen with EUR/USD, ‘old’ supply and demand zones may still be valid. Since the market hasn’t moved substantially, bank traders’ positions will likely remain open by the time the market returns.
In contrast, during a trend, I would prioritize the new zones forming…
The ‘old’ zones from the market’s previous trend phase become less relevant unless they’ve formed at significant lows or during large consolidations.
Regarding your weekly supply and demand zones question, treat them the same way as daily zones…
They’re essentially identical in terms of time rules.
To answer your question about the market closing above the supply zone in a downtrend…
Yes, if the supply zone breaks and the market continues upward without revisiting the demand zone that initiated the move, you can still trade.
You would base your trades on any new demand zones formed during the move.
Happy trading…
PAN.