Pure Price Action Strategy: Market Structure & Supply/Demand Zones

A simple price action strategy with no indicators. It is built on three steps: read the trend, mark the zone, and check the risk-to-reward before entering.

STEP 1: READ THE TREND (MARKET STRUCTURE)
– Uptrend: higher highs and higher lows.
– Downtrend: lower lows and lower highs.
– The trend stays valid until the key swing point is broken (the last important low in an uptrend, the last important high in a downtrend).
– Only look for Longs in an uptrend and Shorts in a downtrend. Do not trade against the structure.

STEP 2: MARK THE SUPPLY OR DEMAND ZONE
Demand zone (uptrend):
1. Find a small sideways consolidation right before a strong move up.
2. Draw a box over the last candle before that move, from its low to its high.
3. Wait for price to come back into the box.

Supply zone (downtrend):
1. Find a small consolidation right before a strong move down.
2. Draw a box over the last candle before that move, from its low to its high.
3. Wait for price to come back up into the box.

STEP 3: CHECK RISK-TO-REWARD BEFORE ENTRY
– Entry: when price retests the zone.
– Stop loss: just below the Demand zone (Long) or just above the Supply zone (Short).
– Take profit: the recent high (Long) or the recent low (Short).
– Minimum 2.5:1 risk-to-reward. Example: risking $100 should give a target of $250 or more. If the setup offers less, skip it.

WHEN TO AVOID IT
– During high-impact news, when price can move fast and slip.
– In tight sideways ranges with no clear swing highs and lows.
– When you cannot place a clear stop loss.

HOW TO PRACTICE
Before using real money, go back on the chart, find past setups that follow these rules, and note how many reached the target and how many hit the stop. Keep the same 2.5:1 filter while you do this.