Extreme vs Decisional Zone
Two supply zones can look identical in structure but produce completely different results. The difference? Location within the structural range. Extreme zones sit at the edge. Decisional zones sit in the middle. This distinction changes everything about how you trade them.
Extreme Zone
- At the very edge of the structural range
- Best possible price for entry
- Highest probability of a strong reaction
- Represents the strongest institutional interest
Decisional Zone
- Between two impulsive moves (middle of range)
- Not the best price — room to the real extreme
- Needs additional confluence to trade reliably
- May give a reaction but often doesn't hold
Why Location Matters More Than Appearance
A beautifully formed supply zone in the middle of a structural range is weaker than a messy-looking zone at the extreme. Why?
Extreme zones offer the best price. If institutions are buying, they want the lowest price. If they're selling, they want the highest. The extreme of the range is where the best price lives.
Extreme zones have the most unfilled orders. The edge of the range is where the largest imbalance occurred. That's where the biggest pool of resting orders sits.
Extreme zones provide the best risk-to-reward. Your stop goes just beyond the extreme. Your target is across the range. This gives maximum reward with minimum risk.
Side-by-Side Comparison
| Feature | Extreme Zone | Decisional Zone |
|---|---|---|
| Position in range | Edge (highest supply / lowest demand) | Middle (between two impulsive moves) |
| Reaction strength | Strong, impulsive reactions expected | Weaker reactions, may not hold |
| Risk-to-reward | Best possible (tight stop, full range target) | Moderate (further from range edge) |
| Confluence needed | Minimal — location is the confluence | High — needs extra confirmation |
| Institutional interest | Highest (best price for large orders) | Moderate (acceptable price, not optimal) |
| Tradeable standalone? | Yes — high probability on its own | Not recommended without confluence |
| How to identify | The zone at the very top or bottom of the range | A zone that formed mid-move, between two impulse legs |
When Decisional Zones Can Work
Decisional zones aren't useless — they just need more evidence to be tradeable:
- Higher timeframe confluence: The decisional zone aligns with a higher timeframe extreme zone
- First level of respect: The zone is part of an order flow shift confirmation
- Strong impulsive departure: The move away from the zone was exceptionally strong
- Unmitigated: The zone has never been tested before
The Rule
When choosing between zones, always prioritize the extreme. The best supply zone is the one at the very top of the range. The best demand zone is the one at the very bottom. Everything else is second choice.
Frequently Asked Questions
Can a decisional zone become an extreme zone?
Yes. If the structural range changes (new BOS creates a new range), what was previously a decisional zone might now sit at the edge of the new range, becoming an extreme zone.
What if the extreme zone has already been tested?
A tested extreme zone is weaker than an untested one. If it held on the first test, it may hold again but with less conviction. If it was breached and price returned, it's likely no longer valid.
How does this connect to the first level of respect?
The first level of respect (the zone that holds after a CHoCH) can form at either an extreme or decisional zone. If it forms at the extreme, the signal is stronger. If it forms at the decisional, the signal is valid but weaker.
Should I skip decisional zones entirely?
Not entirely, but be selective. If you have an extreme zone and a decisional zone, always wait for the extreme. Only trade the decisional if it has multiple confluence factors supporting it.
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