92% found this document useful (13 votes)
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Choch Trading Plan

The document provides a detailed trading strategy involving identifying supply and demand zones on different timeframes and entering trades based on price flips, continuations, or changes of character. Key aspects include waiting for reactions from unmitigated zones before entering, using different timeframes to refine zones, and dragging stop losses after continuations. Credit is given to past courses and mentors for contributing to the strategy.

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Dario Anchava
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© © All Rights Reserved
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92% found this document useful (13 votes)
12K views22 pages

Choch Trading Plan

The document provides a detailed trading strategy involving identifying supply and demand zones on different timeframes and entering trades based on price flips, continuations, or changes of character. Key aspects include waiting for reactions from unmitigated zones before entering, using different timeframes to refine zones, and dragging stop losses after continuations. Credit is given to past courses and mentors for contributing to the strategy.

Uploaded by

Dario Anchava
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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My Sessions Strategy:
Before even starting your session, always look at Forex
factory for any red folders concerning EUR or USD pairs. If
there is a RED folder, trade before or after the news event.
Do not hold your trade during the news release.

Quick recap of how you determine Supply & Demand


zones:

(I expect everyone to know how to find these on the


charts before getting into this strategy)
• Step1: Look at H4/Daily demand/supply:

o We DO NOT care about structure in this strategy.


We simply care about whether supply or
demand is in control, and if price reacts to the
zones. (Daily or H4 depending on what time
frame is clearer for zones)

- Overall these zones on the h4 or Daily will only


matter for reactions on the smaller time frames.
We DO NOT wait for these POI’s to get hit to
enter a trade. Remember, a simple “reaction” on
H4 or Daily zones, can give us 100R trades on the
m1 timeframe!
Step 2: use M15 timeframe for Unmitigated Supply and
Demand zones.

Step3: use m5 to refine your m15 unmitigated


supply/demand zones.

If possible, refine even till m1 or m2. This all depends on


how clean the zones are. If you go from m5 to m1 and it
now gives you 2 unmitigated zones, then keep it to the
m5. However, if it gives you two zones but one has been
mitigated, go for the most recent zone that has not been
mitigated yet. The fact that this zone comes from a
mitigation, makes it a higher probability zone.

I like full body candles, or wicks for supply/demand zones.


If I cannot find one of these two, I’ll go up or down in time
frames to find the perfect fit. (m1, m2, m3, m4, m5)

Once you have successfully annotated your H4/Daily


zones, and your refined m15 zones, we can switch to the
m1 timeframe and wait for our session to start.
Step4: there are 3 different entry types I use in this
strategy during my session:

- DS/SD flips

- Continuation Trades

- Choch Trades

FLIPS

Demand to Supply flip: (DS Flip)

- If price reaches into your unmitigated demand


zone and reacts, you will be waiting for a break of
demand in order to look for shorts.

o Does this mean it needs to break the whole


zone? NO. If demand (in the zone) was strong,
it would have an immediate reaction and
provide you with a choch to the upside
breaking supply levels that provided the
temporary downtrend (pullback).

o However, if supply breaks your unmitigated


demand level or the most recent demand (just
like on the chart image below), we have a
strong indication that supply is in control. So,
we can take the trade from the supply that
caused the break.

Chart example:
(zoom in to read the annotations)
In the picture above, we can see price reacting to our
unmitigated m15 (refined to m5 or below) zone. How
come we got into a sell before price breaks the zone?

It is very simple: If this demand was strong, it would have


reacted strongly and broke new supply levels. Instead, we
saw a flip which indicated that demand was weak, and
supply was back in control. We take an entry on the OB
or supply zone that caused the flip.

Here is a schematic of the same chart:


Supply to demand flip: (SD flip)

- If price reaches into your unmitigated supply


zones you have marked up, you will be waiting for
a break of supply.
o The same rules apply for SD flip as for the DS
flip

Chart example:
In the chart example above, we can see that technically
price did not break our m15 unmitigated supply zone.
However, it did break our minor supply indicating that
supply at this level is not strong at all. If our main m15
supply were strong, price would have reacted and
provided a choch. Since demand broke its minor supply,
we can place a trade on our demand that caused the
break.

Continuations

Continuations are very simple, and my favorite way to


stack orders. Once again, we DO NOT care about
structure. All we care about is a break of the most recent
minor supply or demand.

Your entry will be from what caused the break. Ideally,


you’ll look for full body candles. If you cannot find them,
feel free to go up to the m2 and m3 time frame. Inside-
bars are very helpful for it as well.
Since price broke our minor supply (marked in red), we
can place an entry from what caused the break.
Here are all the scale ins/continuations that were
provided according to the rules. By targeting the next
unmitigated supply, we reached a total of 82.5R. This is
the power of scale-ins/continuations

After each new continuation, I will drag my stop loss


under the new demand.
Choch Trades

Change of character is basically a change in trend. For me,


the ideal set up is to have a choch that breaks two minor
supply or demand zones.

Although a choch could be valid if it breaks one zone, I


find it more reliable if it reacts from a HTF zone and
breaks two minor supply/demand zones (as illustrated
below)

In this schematic you can see that demand has broken


two minor supply levels. This is a choch. Could you place
an order on the play? ONLY IF THE PULL BACK DOES
NOT COME FROM AN UNMITIGATED SUPPLY ZONE
If price does come from an unmitigated supply zone, wait
for a confirmation entry
❗ Additional information ❗

No matter what entry type I have shown, if your pullback


comes from an unmitigated zone, you cannot place a
limit order. NEVER. You would have to wait for a new flip,
and let the market show its hands. This information
seems very basic, but to me it was a small “nugget” that
made it all click.

Now you know if price is creating engineered liquidity, or


not. You will not be confused about being on the side of
the market, and you will avoid unnecessary losses.

Here are schematics to explain the concept:

In this example, we have a supply set up, but price is


pulling back from an unmitigated demand zone. Even
though we are in a MAJOR downtrend, we can simply not
put our sell limit because demand is in control.
In order for us to be able to take the sell in the same
scenario, we would need a flip or a change of character
so that we know supply is back in control.

The only way to be able to place a limit order without


worrying if our zone will hold or not without waiting for
flips or choch, is if our initial zone broke structure, but
also its pullback is NOT coming from an unmitigated
zone.

Below will be displayed both scenarios in which you can


take a limit (risk entry).
Price trade through the unmitigated m5 demand zone

Price did not reach the unmitigated m5 demand zone,


indicating a healthy pullback with from which we can
take a short.
How to account for spread (Funding challenges, etc.)

- If your spread is max 0.5 pips, you will have to


account for spread this way:
If you struggle with finding Supply or demand zones, and
liquidity pools, you can use the “Fixed range Volume
Profile” indicator.

The way you use it, is by first selecting the start of the
impulsive movement, and drag it till the end of the
impulsive movement.
The volume profile will basically tell you
where most of the orders lie. The bigger
the bell shape, the stronger the demand
or supply. The zones with almost no data,
are simply liquidity zones/ imbalances.

These are the exact settings I use for the


Indicator.
BONUS

Brief m15 scalping strategy

This is a very structured way I scalp any pair when setups


appear:

Step1: use the H1 chart and look for overall bias. (what is
your trend? Are we bullish or bearish)?

Step2: use the M15 chart and wait for a break of structure

From this image we can see that h1 is bullish, and we just


got a M15 Break of structure. You will now mark up the
candle that caused the BOS (Demand zone)
Step3: use the m5 to refine the m15 demand/supply zone
or order block

Step4: on the m1 chart you will patiently wait for price


to reach your zone and wait for it to break m1 structure.

Once price tapped in your zone and broke structure, you


can enter in a trade from the demand/OB that caused the
m1 BOS

We can clearly see that when price reached out m5 zone,


price then broke structure up and formed a full body to
body order block. This is your ideal entry.

In terms of targets, look for double tops/bottoms, trendline


liquidity, or major demand and supply zones.
ChochFX Tr
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