1. Supply & Demand
Pattern Recognition

2. Disclaimer
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3. Paint Bars (Volume Driven Candles)

4. Zone Mechanics (Supply/Demand + Volume Profile)
There are 2 lines that form an SDV Zone:
Stop Line – Farthest from current price
Formed using price action pattern recognition
Value Line – Closest to current price
Formed using VWTPO and value area from volume profile
STOP LINE
ABOVE
CURRENT PRICE
SDV SUPPLY ZONE
VALUE LINE
CURRENT PRICE
VALUE LINE
SDV DEMAND ZONE
BELOW
CURRENT PRICE
STOP LINE

5. Zone Mechanics (Stop & Value Lines)

6. Zone Terminology
A “FRESH” zone is when price has not traded into the zone yet.
This tells us that buy/sell orders still remain in the that price level.

7. Zone Terminology
A “TESTED” zone is when price has traded back at least once into the zone.
This tells us that some of the buy/sell orders have been used/consumed in the that price level.

8. Zone Terminology
A “BROKEN” zone is when price has traded back either once or several times to completely violate the zone
This tells us that all buy/sell orders in the zone have been completely used up and therefore cannot support price at that level.

9. Supply & Demand (Orderflow Patterns)
There are 2 patterns that form supply & demand zone.
Reversal Pattern (RP)
RBD (Rally – Base – Drop)/Sell Setup
DBR (Drop – Base – Rally)/Buy Setup
Continuation Pattern (CP)
DBD (Drop – Base – Drop)/Sell Setup
RBR (Rally – Base – Rally)/Buy Setup
Locating these patterns is the same on all timeframes and charts.

10. Reversal Pattern Setups
DBR (Drop-Base-Rally)
BUY SETUP
Base
Supply Zone
(Origin of Imbalance)
Drop
Rally
Demand Zone
(Origin of Imbalance)
Rally
Drop
RBD (Rally-Base-Drop)
SELL SETUP
Base

11. Continuation Pattern Setups
Rally
Drop
DBD
(Drop-Base-Drop)
SELL SETUP
Base
Base
Demand Zone
(Origin of Imbalance)
Supply Zone
(Origin of Imbalance)
RBR
(Rally-Base-Rally)
BUY SETUP
Rally
Drop

12. Combined Pattern Recognition

13. Locating Demand Zones

14. Locating Supply Zones

15. SDVolumeZones Pattern Summary
SETUP
TYPE
ACTION
REVERSAL
RBD
RALLY/BASE/DROP
SUPPLY
SELL SHORT
DBR
DROP/BASE/RALLY
DEMAND
BUY LONG
CONTINUATION
DBD
DROP/BASE/DROP
RBR
RALLY/BASE/RALLY