Support/Resistance vs Demand/Supply
Support and resistance — the broad level
Classic S/R marks a price area where price has reacted before. It is useful for identifying the general zone of interest but is typically a thick, fuzzy area. A support line drawn at ₹500 might actually mean anything from ₹496 to ₹506 — there is no clear invalidation point.
Demand and supply — the precise box
A demand zone is a rectangle with a specific proximal and distal line. It gives an exact entry reference (proximal), an exact invalidation (distal), and therefore an exact risk distance. Every calculation in the trade setup flows from that precision.
Using both together
Find the broad S/R area first — this tells you where to look. Then find the precise demand or supply zone within that area for the actual study setup. The S/R gives context; the zone gives execution structure.
Why zones beat lines
A support line tells you price might react there. A demand zone tells you exactly where the reaction could begin (proximal), where the idea fails (distal), how much to risk, and how to size the position. The extra precision converts a vague level into a complete, calculable study framework.
Practice checklist
- Use S/R to identify the broad area of interest
- Find a precise demand/supply zone within that S/R area
- Define entry, stop and size from the zone's proximal/distal, not the S/R line
Mistakes to avoid
- Treating a thick S/R area as a precise entry — no clear invalidation means undefined risk
- Skipping zone identification and just trading off horizontal lines