How Do You Determine If SD Zone Has Formed Due To Profit Taking

Hello Sir,

 Am very grateful for the books you sent to me, those books have been of very good benefit to me, You have really changed my perspective of forex trading entirely for good.

I make sure i read the books you sent to me everyday and i also read all your articules on advanced forex strategies everyday too and to my utmost surprise i will definately gain a new thing each day,as i told you in one of my mails to you that i have stopped trading for now cos i really want to grab the new stuffs you showing in your books and to my surprise i was thinking it will take me months before i could grab them but alas these concepts are so easy to grab cos you have detailed evrything in your books and articles. This week alone i could spot very good trading setups in some pairs and it did produce fantastic results.

The most amazing thing about your method of trading is that you really detailed how the banks do manipulate the market to sneak in their trades example of these happened yesterday during the USA CPI news release.

The news affected pounds and euro but it did not affect aud cos the banks are already positioned to go long, the news from canada yesterday too was bad and the news from USA was good but the canadian dollar which was supposed to go long { using my dumb thinking } did not go long cos the banks were already positionsing to go short.

Your method is really amazing i must confess.

The only major problem i have now is to determine and know when the banks are taking profits off trades. I will like you to help me more on that sir

I will still continue to pause trading for like 2 more weeks cos i still want to learn more from you.

You taught me what i did not know in my 10 years of forex trading in just 3 weeks at no cost at all, anytime there is a move in the market i could confidently pinpoint what exactly is happening at least with very good degree of accuracy.

I want to say thank you, thank you and thank you again am indeed very grateful to you sir.

My Response:

For spotting zones where banks are likely taking profits, it’s all about recognizing specific patterns in the zone’s formation.

Scenario 1: The Pause That Refreshes

Imagine the market is in a uptrend. Suddenly, price takes a breather, pausing for a few candles before continuing its ascent.

This pause is often a sign of profit-taking.

Scenario 2: The Mini-Retracement

Another telltale sign is a small retracement within a larger trend.

By “small,” I mean a move of just a few pips against the prevailing direction. This minor pullback can also indicate profit-taking.

Scenario 3: New Highs and Lows

Here’s an interesting one: When the market is falling and making fresh lows, any demand zone you draw from those new lows is likely a profit-taking zone. The upward movement from the low is fueled by banks cashing in on their short positions.

The opposite is true in an uptrend.

If the market is rising and setting new highs, any supply zone drawn from those highs is likely a result of banks taking profits on their long trades.

  • For more examples: Be sure to check out the “Profit Taking Supply and Demand Zones” section in my supply and demand book.

Cheers,

PAN.

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