Zone Refinement for Better Entries — Step-by-Step Guide & Transcript

[00:01] hear about all the time, but oddly enough, never pay really much attention to it. That is until now. What if I told you all you had to do was apply one simple tweak to your current strategy that would instantly boost your trading

[00:14] profit? Like actually implementing this trick on any trading strategy has been statistically proven to generate better profits. Once you apply this tweak, your takeprofits will grow, your risk will shrink, and it will take you from this

[00:27] averagel looking setup to this sniper looking entry with jaw-dropping profits. But what's the secret trick? Well, first things first, we need to go on a chart. Go to the 4hour time frame. This is important. Next, we first need to

[00:40] implement our areas of supply and our areas of demand. If you don't know, demand is the start of a strong move upwards. Supply is the start of a strong move downward. For example, if we had this move where there was a strong

[00:52] impulse to the upside, we would find the candle that started this move. So, this one. Grab our little rectangle tool on the side and mark from the lower wick to the higher wick of the candle that started this move. This is our area of

[01:05] demand. Pretty easy, right? This area is where large institutional orders started coming in. Oftent times, price will come back down to this area of demand. And traders will then proceed to have the exact same mindset. Enter here and then

[01:17] proceed to make some juicy profit. It's the exact same thing with supply. Find the start of a strong move downwards. Grab your little rectangle tool. Mark of the candle that started that move. Wait for price to come back up to the

[01:30] area of supply again. Enter a short. Proceed to make millions of dollars. But we ran into a major problem. So, if we're purely going off the whole supply and demand strategy, we might get a setup that looks like this, where we

[01:42] have the start of a strong move upwards. We mark our area of demand by marking the first candle of said move. We would then wait for price to come back down to our area of demand. Now, if we're entering into this position normally, we

[01:54] into our area of demand. We would set our stop loss below the area of demand. And for a takerit, it would really only make sense for us to target the recent highs for the most probable outcome. But this is exactly where the problem

[02:08] resides. This risk-to-reward setup is absolute poop. Like really poop. To be a bit more specific, this exact trade had a 2.14 risk-to-reward ratio. Meaning, if potentially getting back

[02:23] $214, which may not sound bad to some. Hell, if you use this exact same strategy, you would probably still be profitable. But with that said, what if somehow someway we could raise this risk-to-reward number to where we would

[02:36] still be following the exact same strategy, but we would be risking even less and profiting even more. That would be pretty good, right? Actually, I just got an idea. Let's test out this new Siribased audio editing software I just

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[03:42] deposit bonus, use the link in my description. All right. Now, let's go over how to get a better riskreward. To do this, we're going to go over a little topic called zone refinement. Zone

[03:54] For example, here we have two screenshots of the exact same chart. One on the 4hour time frame and one on the 1 hour time frame. Just like before, we have the start of a strong move upwards. So, we'll mark our area of demand on the

[04:08] 4hour time frame just like we did before. But instead of entering as soon as price hits our area of demand on the 4hour time frame, we're going to move to a smaller time frame to refine our zone even more. So here on the 1 hour time

[04:21] frame, our 4hour zone is right here. But if we look closely, our 1hour demand zone is within this zone, but is much smaller. So we'll mark out this one, too. So now we have a refined 1 hour zone within our 4hour zone. Instead of

[04:37] entering as soon as price hits our demand zone on the 4hour time frame, we're going to enter at a refined zone on the 1 hour time frame. So we wait for price to come to our 1 hour zone. Enter here. We're still going to set our stop

[04:49] loss below the 1 hour demand zone and set our takeprofit at the recent highs just like we did before. But look at the key differences. The picture on the left where we didn't refine our entry, our stop loss is bigger, our entry is worse,

[05:03] and our takerit is smaller and we have a risk-to-reward of 5.15. But if you look at the picture on the right, we have a way better entry. Our stop loss is smaller, meaning we're risking less, and our take-profit is bigger, meaning we

[05:17] have the potential to make more money, and we have a risk-to-reward of 11.12. Both are using the exact same strategy, but one is just more redefined. I think you can see the obvious better choice, the one where the

[05:31] math is on our side, but this is just the idea. Let's jump into an actual trade example. First things first, we do our first step and hop on the 4hour time frame. Here we have a pretty strong downtrend, but price is starting to show

[05:44] signs that it wants to do a reversal. How I can tell it wants to reverse is it just started to shift in trend direction and has made a break of structure right here. So, we'll keep that in mind. To start us off with this trade setup,

[05:56] we're going to first mark our area of demand. To do this, we find the first candle that started the strong move to the upside. In this scenario, that would be this candle right here. So, we grab our little rectangle tool on the left

[06:08] and mark from the lower wick to the higher wick of this handle. This is our demand zone. So, if we were to plan this trade out normally, we would wait for price to come to our area of demand. We would

[06:21] enter as soon as it does and set our stop loss right below it. We would then target the most recent high, which is this high right here. So, if we use these exact parameters, our risk-to-reward would be 5.23, 23, which

[06:35] in the end isn't really a bad trade at all. Hell, I take a 5.23 risk-reward all day. That's actually pretty good. But as my grandma used to say, why settle for a better one? To do this, we're going to switch to the 1 hour time frame to

[06:49] refine our demand zone even more. So, now that we're on the 1 hour, we can instantly see we have more candles. Now, we still have the exact same setup, just more candles in our view. Our 4hour demand zone is still here. But if we

[07:03] look closely, our 1hour demand zone would actually be right here at the candle that started this trend. So by doing this one simple trick, this one simple change, we can do what every hedge fund manager dreams of doing. We

[07:18] hedge fund manager dreams of doing. We can do much, but we improved our risk-to-reward ratio from just a measly 5.23 to a

[07:31] whopping 7.6 by simply dropping to a lower time frame and refining our zones. That's it. That quick and simple, easy trick just improved our risk-to-reward by 2.4, meaning we're risking less now, and we

[07:45] have the potential to gain even more money. And who doesn't want more money? So, now that we have it set up, we're going to go to the 4hour time frame. And rather of entering up here at this high, we're now entering at a more discounted

[07:58] price in a refined area, which is going to give us the best risk-to-reward for this trade. Let's see what happens. Price comes down to a refined zone. We enter as soon as it does. The market proceeds to push up with huge amounts of

[08:12] strain and beautifully hits our target. Even though this strategy is great, we've ran into a major problem. You see, I'm sure you've had this thought already. Well, if I can get a better entry from going to the 4 hour to the 1

[08:24] hour, that also means I can get an even better entry from going into the 1 hour to the 30 minute, then the 30 to the 15, then the five, and then continuously go millisecond. And that, my friends, is what I'm going to call over refinement.

[08:40] Over refinement is a problem simply because of this reason. Say if we went to the 5minut time frame for this specific trade. We would have to zoom all the way down to this 5minute demand candle. And the problem with that is

[08:53] sure we now have an amazing risk-to-reward and an even better one than we did before. But since we've narrowed it down so much, if we zoom back out, price never came down to our 5minute demand zone. Don't overrefine

[09:06] and don't zoom in too much because you will end up with mispositions just like this one. to make sure you don't overrefine, just follow what I call the two steps down rule. So, if you're on the daily time frame, you can only

[09:19] refine down to the 4 hour and then the 1 hour time frame. If you're on the 4 hour to start out with, you can only go down to the 1 hour and then the 30 minute. If you're starting off with the 30 minute time frame, you can go down to the

[09:31] 15-minut and then the 5 minute. My point being, you can only go down two steps from the original time frame you started on. This will make it so you don't misposition. Add this trick to your arsenal to any of your trading

[09:44] strategies and it'll help you get more sniper entries. Try it out. Let me know how it works for you and DM me on Instagram with your results. Thanks for watching and I'll see you guys next time. Also, I've been getting a lot of

[09:57] comments saying I need to post more, and you're probably right. I'm kind of slacking recently. I'll try to do better. Maybe. We'll see.