Supply and Demand Indicator Sierra Chart

The Problem Every Sierra Chart Trader Faces

If you trade futures, forex, or any instrument in Sierra Chart, you've probably asked: "How can I automatically identify supply and demand zones?"

Unlike platforms like TradingView that have dozens of community indicators, Sierra Chart lacks a native supply and demand zone indicator. Most traders are forced to either:

• Manually draw zones (time-consuming and subjective)
• Use basic support/resistance tools that miss the nuance

We built a FREE custom C++ study that automatically detects supply and demand zones using Volume At Price data—revealing where institutions are actually trading, not just where price bounced.

Why Volume Changes Everything

Traditional supply and demand trading relies on price patterns only—looking for consolidation before explosive moves. But this approach misses a critical element: where did the actual trading occur?

Our volume-based supply and demand indicator for Sierra Chart uses Volume At Price (VAP) data to identify zones where very little trading happened. These "empty" zones are significant because:

Supply and Demand Zones vs Support and Resistance

Many traders confuse these concepts. Here's the critical difference:

How Institutions Create Supply and Demand Zones

Large institutional traders cannot enter positions all at once—it would move the market against them. Instead, they:

1. Accumulate or distribute positions in a range (creating high volume)
2. Push price away from that range aggressively (creating LOW volume zones)
3. Leave unfilled orders behind at the origin
4. Price returns to fill those orders—this is the "zone retest"

The All-In-One Volume Zone Solution

We developed this custom C++ study specifically for Sierra Chart traders who want institutional-grade supply and demand zone detection without paying hundreds of dollars.

Unlike basic price-pattern indicators, our tool analyzes Volume At Price data to find genuine low-liquidity zones where price accelerated—the footprints of institutional order flow.

How the Algorithm Works (Simplified)

1. Build Volume Profile: The indicator divides the price range into bins and calculates total volume in each
2. Identify Low Volume Areas: Bins with significantly less volume than neighbors are flagged
3. Merge Adjacent Zones: Consecutive low-volume bins are combined into single zones
4. Calculate Emptiness: Each zone gets a score (0-100%) based on how "empty" it is relative to peak volume
5. Dynamic Coloring: Zones are colored based on current price position (above = supply, below = demand)

🛠️ How to Install the Supply and Demand Indicator

Installing custom studies in Sierra Chart is simple. After downloading the . dll file from your email, follow these steps:

What Creates Supply and Demand Imbalances?

Supply and demand zones aren't just arbitrary price levels—they represent institutional footprints left behind in the market.

When large traders need to execute significant orders (thousands of contracts), they cannot do so all at once without moving the market against themselves. Instead, they:

• Accumulate: Quietly build positions in a range before a move up
• Distribute: Quietly sell positions in a range before a move down
• Leave unfilled orders: Their full size isn't executed, leaving resting orders

The zones our indicator finds are the "fast move" areas—where price accelerated quickly, leaving a trail of low volume and unfilled orders.

Why Price Returns to These Zones

Markets seek efficiency. When price moves too quickly, it creates an imbalance that the market typically corrects:

1. Unfilled Institutional Orders: Large players still have orders waiting at the zone
2. Retail Stop Losses: Traders who entered during the fast move have stops at the zone
3. Profit Taking Targets: Traders targeting the zone as a reversal point