How to Identify High-Probability Supply and Demand Zones
Most traders learn supply and demand early. Boxes on a chart. Price went up from here, down from there. Easy. And yet… Most traders still lose money using them. Not because supply and demand doesn’t work — but because they don’t understand what actually makes a zone high-probability. This isn’t about drawing more rectangles. It’s about understanding why price reacted, who was involved , and whether that imbalance is still valid. Let’s slow it down and talk about what supply and demand really is. What Supply and Demand Actually Represents At its core, supply and demand zones are footprints of institutional imbalance. They mark areas where: Buyers overwhelmed sellers (demand) Sellers overwhelmed buyers (supply) Not temporarily — decisively . These zones exist because large participants couldn’t fill their entire position at one price, so price had to move aggressively to find liquidity elsewhere. That aggressive move is the clue. Retail traders tend to focus on: The box The candle...