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3 Sam Seiden Trading Tips
Every Supply & Demand Trader
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Must Know!
Sam Seiden’s trading tips & method of trading supply and demand is still
very popular with traders even though the main premise its built on is
awed. (see this (https://www.forexmentoronline.com/supply-and-
demand-trading-the-essential-guide/)article
(https://www.forexmentoronline.com/supply-and-demand-trading-the-
essential-guide/) for reasons why )
Whilst I’ve tried my best to open people’s eyes as to why the Seiden method is
awed, I understand there is still a large selection of traders who continue to trade
supply and demand using Sam’s rule set.
A long time ago I used to trade supply and demand using the rules provided by Sam
Seiden.
In my time trading the method I managed to pick up a few small tweaks you can
make in order to nd and place trades which have a higher probability of working
out successfully. I’m going to share these tweaks with you today and hopefully you
can see an improvement in your own supply and demand trading.
Table Of Contents [hide]
1.Lower Time-Frame Zones Within Higher Time-Frame Zones

2.The Halfway Entry
3.Find The Source Of The Zone
Summary
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1.Lower Time-Frame Zones
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Within Higher Time-Frame
Zones
One of the rst things I learned when I was looking for a way to increase the success
rate of supply and demand zone trades was that when you nd a lower time-frame
zone contained within a higher time-frame zone you are more likely to have a
winning trade.
It’s important to note which time-frame you nd the zone is in has a big e ect on
whether the trade will work out or not.
A zone on the daily chart is likely to contain multiple zones inside it on the 1 minute
chart, therefore it’s not really logical to try to trade these zones as there’s a high
chance you going to lose on at least one of the positions.
What I used to do was look for 1 hour zones which were inside 4 hour zones, in fact I
actually back-tested this over a years worth of trades on EUR/USD and found that if
you were to only trade 1 hour zones which are contained inside 4 hour zones you
would win on a signi cantly higher number of positions than if you were to just
trade the 1 hour zones on their own with no additional con uence.
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(https://dlb6879620p6s.cloudfront.net/wp-content/uploads/2016/03/Aviary-
Photo_131018400667165125.png)
Here we have a 4 hour chart of AUD/USD.
I’ve marked three 4 hour supply and demand zones, we are going to take a look at the
1 hour chart to see if any of these 4 hour zones contain 1 hour areas inside them that
we use to look for trading opportunities.
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Photo_131018403570865314.png)
On the 1 hour chart we can see there are two demand zones which are inside 4 hour
demand zones
Both of these demand zones worked out successfully had you traded them, the
supply zone seen at the top of the image does not contain a 1 hour zone due to it
being created by a new event.
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Photo_131019491491299403.png)
This is the same image only I’ve marked an additional four 1 hour supply and
demand zones so you can see how the zones within the 4 hour areas tend to work out
more o en than the typical 1 hour zones.
Trading zones within zones can require a certain amount of patience depending on
which time-frame you usually take trades o , if your used to trading supply and
demand zones on the 1 hour chart then it may be di cult for you to only take a trade
when you see a zone inside a 4 hour zone, therefore tweaks to your trading plan may
be needed.
I’ve made a list below on which time-frame to use to look for zones within zones.
Daily chart: Don’t go any lower than the 1 hour chart to nd zones
4 hour chart: Don’t go below the 1 hour chart
15 minute chart: No lower than the 5 minute chart
2.The Halfway Entry
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My next tip isn’t really something you can use to increase the chances of having a
successful trade.
Instead its a method you can use to risk less money on each trade, this will be helpful
if you only have a small amount of money in your brokerage account.
The Sam Seiden method of trading supply and demand involves placing pending
orders at the zones for when the market returns, sometimes you’ll have zones which
are bigger in size than the total amount of money you have available to risk on each
trade which means you either have to miss the trade out or take the trade using
di erent entry parameters.
So in an e ort to reduce the risk on the trade I came up with the idea to slice the size
of a supply and demand zone in half and place your pending order at the halfway
point, thereby cutting the distance of your stop-loss from entry in half too.
This may sound like a bad idea, I mean no doubt it will lead to missed trades where
the market only manages to get to one of the outer edges of the zone, but at the same
time it will increase the amount of supply and demand zone trades you can place.
Using pending orders as an entry strategy is risky in itself because its rare for the
market to spike the outer edge of the zone then reverse, most of the time the market
drives into the zone before reversing, therefore by using pending orders you are
unnecessarily risking more money than you need to had you waited for a price
action signal (https://www.forexmentoronline.com/how-to-trade-supply-and-
demand-with-price-action/) inside the zone or placed a pending order at the halfway
point of the zone.
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Photo_131017460702787774.png)
Another thing the halfway entry is useful for is when the market is in a strong
trending movement and you want to try and pick the place where it will reverse.
Typically what supply and demand traders tend to do when the market is in a strong
trend is use supply and demand zones to pick the place where they think the trend
will stop and reverse, more o en than not these zones have tendency to be broken
due to the strength of the trend. When a zone does cause a reversal, the market
drives deep into the area before reversing rather than spiking one of the edges and
reversing, this is when the halfway entry is used best.
If we use the image above as an example if you were trying to catch a reversal of this
up-move you place a pending order to sell at each one of the supply zones, by
placing a trade at each one of these zones altogether you would be risking 42 pips
assuming your stop-loss covers the range of the zone, by implementing a halfway
entry, you would only risk 21 pips and you could have peace knowing that when the
market nally does reverse its likely to move far into the zone rather than spiking the
edge and bouncing in the other direction.
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3.Find The Source Of The
Zone
This next tip is something which is applicable to the Seiden method of trading
supply and demand and my method of trading supply and demand.
The process of nding the source of supply and demand zones is one where you can
lower the total amount of money needed to risk on each trade. I’ve seen other traders
do this, although they abuse it slightly and go down onto the lowest possible time-
frame to nd the source of the zone, what this inevitably leads to is zones which the
market ends up missing by a few pips which can really frustrating when your trying
to make money.
To nd the source of a supply and demand zone you need to determine which time-
frame you trade-o , as its how far down you go on the lower time-frames to nd the
source of the zone depends alot on which time-frame you usually trade.
Since I usually trade-o the 1 hour chart the lowest time-frame I’ll use to nd the
source of supply and demand area is the 5 minute chart, any lower than this and it
can become tricky to determine where the source begins and ends.
We use a two-step process for nding the source of zones.
Step 1 is to locate the supply or demand zones you wish to nd the source of.
For the sake of this example we are going to use one of the supply zones seen in the
previous image.
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Photo_131017469531320854.png)
Above you can see I’ve marked a supply zone on the 1 hour chart of EUR/USD, the
total size of this area is 16 pips which mean the distance of your stop from entry is 16
pips assuming you trade the zones using pending orders.
Now we have our zone marked, we need to switch to the 5 minute chart to see if we
can nd the exact point where selling entered the market creating the supply zone.
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Photo_131017472253034343.png)
From the 5 minute chart we can see that the zone we have drawn on the 1 hour chart
covers an area much larger than the actual source, what we need to do now is resize
the area to more accurately de ne where the selling came into the market.
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Photo_131017475529361034.png)
A er re-sizing the area you can see how the amount of pips we would have had to
risk decreases dramatically, the zone is now only 6 pips as opposed to 16 pips.
Here’s another example, this time we’ll nd the source of a demand zone.
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Photo_131017698927616410.png)
Here we have a 1 hour demand zone on EUR/USD, as you can already see this
demand zone would have resulted in a successful trade if you traded it, the total size
of this zone is 20 pips, hopefully by nding the source we can knock a few pips o
the total size of the zone.
To nd the source and lower how much we have to risk on the trade we need to go
down to the 5 minute chart.
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Photo_131017701735819873.png)
Now we can see the exact point where the demand zone was created.
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Photo_131017703954759732.png)
A er nding the source of the zone and reshaping the area to better de ne where the
buying came in, you can see how the size of your stop has been reduced by 5 pips,
now you only have to risk 15 pips instead of 20 pips which is what the zone was
initially.
You may have already noticed there’s a problem with our reduced zone ?
When the market returns to the area the spike lower fails to touch the zone, if you
had a pending order to buy placed at this demand zone your trade would not have
been executed and you would have missed a successful trade.
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It’s a good idea to always add two or three pips onto the size of the
zone once you have found the source, although the size of the zone has
decreased signi cantly what you’ll nd is many times the market will
spike the bottom of the area and your pending order will not be
executed due to the spread, by adding an extra few pips onto the zone
you’ll increase the amount you have to risk but also giver yourself a
better chance of getting your order executed.
Whilst it may seem silly to nd the source of supply and demand zones just to knock
a few pips o the total amount you’ll need to risk on trades, over time it will add up,
and you’ll nd that not only will you be able to risk less on each trade, you also be
able to take trades at a higher leverage even if you only have a small amount of
money in your account.
If you had a zone which was 16 pips initially and a er nding the source it’s really
only 8 pips then you can take the trade at twice the leverage and your maximum risk
would still only be 16 pips, so your only risking as much as you would have in the
rst place if you never found the source of the zone.
Summary
The Sam Seiden supply and demand method is one that carries some huge aws in
its thinking and execution.
But that’s not to say it cannot be used to make money, it is possible to make decent
pro ts from Sam’s method but you will eventually grow tired of losing on trades
which you could have been winning had you been using price action to enter into
positions. I hope some of the tips provided to you today will allow you to make some
steady progress in your supply and demand trading, if you have any questions about
the topics discussed in this article please leave them in the comment section below.
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Get My 6461 Word Book On Supply And Demand Trading
To Learn......
How Old Supply And Demand Zones Do Not Cause The Market To Reverse And The Reason Why Traders
Mistakenly Believe They Do
Why The Time It Takes For The Market To Return To A Supply Or Demand Zone Will Determine Weather The
Zone Has A High Chance Of Causing A Reversal To Take Place
The Di erences Between Zones Created By Bank Traders Taking Pro ts And Zones Created by The Bank
Traders Placing Trades
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Comments
Kai says
APRIL 8, 2016 AT 10:37 AM (HTTPS://WWW.FOREXMENTORONLINE.COM/A-FEW-TIPS-FOR-SAM-SEIDEN-TRADERS/#COMMENT-
269)
Your blog has helped my trading greatly

I have a few questions
1. How do you personally determine the trend
2. When you trade supply demand. Do you trade with or against the trend
3.do you have a certain number of pips you target depending on your set-up
REPLY
ForexMentorOnline says
APRIL 8, 2016 AT 1:24 PM (HTTPS://WWW.FOREXMENTORONLINE.COM/A-FEW-TIPS-FOR-SAM-SEIDEN-
TRADERS/#COMMENT-271)
Hello Kai, glad my site has helped your trading.
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In regards to your questions I’ll try and answer them as best I can the only problem is the way I
determine trend is tough one to answer as it incorporates many di erent concepts which are out
the scope of a single comment, I’ll be bringing out an article soon which will go into more detail
about the method I use to determine what the current trend is in the market.
When I trade supply and demand I always trade in the direction of the most recent higher high
for uptrends, and recent lower low for downtrends. It doesn’t matter to me what the daily trend is
I just trade in the direction of the current momentum, its important to note I primarily trade
supply and demand zones on the 1 hour chart, so I’ll only be looking for lower lows and higher
highs on that time-frame.
I dont try to target a certain amount of pips no matter what the setup is, if the trade is taken in
accordance with the daily trend and I believe I’ve managed to get in a good point where the
market is going to continue trending for a decent length of time, I’ll hold onto the trade and
attempt to scale in with as many additional trading positions as possible.
Hope that helps, If you have any more questions dont hesitate to let me know and I’ll answer
them for you.
REPLY
Gilberto says
AUGUST 7, 2016 AT 12:20 PM (HTTPS://WWW.FOREXMENTORONLINE.COM/A-FEW-TIPS-FOR-SAM-SEIDEN-
but if you trade the 1 Hour TF do you go to the Daily to con rm if the trend is up or down and place
trades in that direction only? by the way i love this report and the others that i already read.
REPLY
AUGUST 7, 2016 AT 2:15 PM (HTTPS://WWW.FOREXMENTORONLINE.COM/A-FEW-TIPS-FOR-SAM-SEIDEN-
No just stay on the 1 hour and trade in the direction of the most recent higher high or lower low,
it doesn’t matter what the daily trend is.
REPLY
Iggy says
SEPTEMBER 1, 2016 AT 12:27 PM (HTTPS://WWW.FOREXMENTORONLINE.COM/A-FEW-TIPS-FOR-SAM-SEIDEN-
Very usefull blog, appreciated a lot,

can you tel me what “bu er room” do you use for stop loss, I mean we ussualy put the stops bellow the
zone for the distance of a spread or ATR or just on the edge……? I think it’s usefull add some pips
bellow/above the zone to avoid stoping out for a pip……. although with this we icrease risk – or reduce
position size. Also depend on asset you trade forex, index like DAX30 – huge volatility spkes…. or WTI
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high spread…..
Glad to hear your comment
REPLY
ahsan says
So In a nutshell, what i learn from here that if i want to increase the success rate of supply or demand
area we will preferably take the trade….
1. Draw the supply/demand area in the con uence of two timeframe, e.g-4 hour to 1 hour.
2. A er get con uence. We than try to nd out the source of the zone. For that we have to go the lower
timeframe from which timeframe we presently trading. e.g-1 hour to 5 minute.
3. Than from there we will ne tuning our supply/demand zone. A er re ning our zone we will wait for
the price to return the zone and form some price action pattern for trade con rmation. Am i in right
way?
Now i have a little confusion about which timeframe i should be use for candlestick pattern for trade
con rmation?
Is it the timeframe which i traded in the present e.g-1 hour or is it the timeframe which i used to re ne
the zone e.g-5 minute?
REPLY
It’s the time-frame you traded in the present not the time-frame you use to re ne the zone. Also
the tips I give out in the article are only for the traders who trade supply and demand using the
Sam Sedien rule-set, not the rules which I give in my supply and demand articles.
REPLY
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Table Of Contents [hide]

1.Lower Time-Frame Zones Within Higher Time-Frame Zones

1.Lower Time-Frame Zones

Here we have a 4 hour chart of AUD/USD.

2.The Halfway Entry

We use a two-step process for nding the source of zones.

Your blog has helped my trading greatly

Hello Kai, glad my site has helped your trading.

Very usefull blog, appreciated a lot,

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