There is constant demand and supply trading in the Stock market. If you look at the depth of the market you will be able to see the order to buy and sell at different prices.  Such numbers show demand and supply trading. How to identify supply and demand zones on a chart ? all detail are below with simple strategy for find demand and supply trading.

Demand and Supply Trading ⇒ “Demand Zone” :

At Demand Zone, Buyers are dominated to buy and Sellers are weak.
At Demand zone, Massive Buying pressure.


  • There is minimum risk
  • There is high profit potential
  • The probability for right trade is high
  • Very easy to identify the area
  • The risk to reward ratio is more

How to identify demand zone ?

  • First of all look at the chart
  • Look at the left hand side of previous low where the previous strong rally started
  • Find out the origin or start point of the strong rally
  • Draw two parallel lines: 1st line at low and 2nd line at nearest close
Demand and Supply Trading

1.Price Comes in Demand Area 

Demand and Supply Trading

2. Reversal Candle In Demand Area

Demand and Supply Trading

3. Reversal Candle Breakout 

Demand and Supply Trading

Example Chart of Demand Zone

Demand and Supply Trading ⇒ ” Supply Zone ” :

At supply Zone, Sellers are dominated to sell & Buyers are weak.
At Supply zone, Massive selling pressure.

Main advantages of selling in supply zone:

  • Minimum risk
  • High profit potential
  • High probability for Right trade
  • Very easy to find out the area
  • Risk reward ratio is more

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How to find out supply zone

  • First of all look at the chart
  • Look at the left hand side of previous high
  • Where the previous strong down trend starts
  • Find out the origin of the strong down trend
  • Draw two horizontal parallel lines 1st line at high and 2nd line is at nearest close.
Price Comes in Supply Area

1. Price Comes in Supply Area

Reversal Candle in Supply Area 

2. Reversal Candle in Supply Area 

Reversal Candle Breakout


Example Chart of Supply Zone 

Supply Zone Example
Supply Zone Example 2

Example Chart of Demand and Supply Trading Zones

Trading Foundation

Right EntryTrendPatternVOLUMEM. A.
Buy at Demand Zone


Sell at  Supply Zone.

Always Put SL.

Take Confirmation.

Find out Nifty trend.


Find out stock with same Direction

Always Trade Active stocks.

Find  out Patterns either  Bearish or Bullish.


for Greater Profitability.

Always check Volume at Demand and Supply Zone.


And Break out  of bar.

Always shows the Strength and direction of stock or Index.


Use for Stop loss.

Amibroker AFL Code : Demand & Supply Trading Zones


Prashant Raut is a successful professional stock market trader. He is an expert in understanding and analyzing technical charts. With his 8 years of experience and expertise, he delivers webinars on stock market concepts. He also bags the ‘Golden Book of World Record’ for having the highest number of people attending his webinar on share trading.