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Price level action is actually a specific way of buying and selling, in which the chartist merely looks at the activity associated with price level and absolutely nothing more. It's utilised by all different varieties of forex traders, trying to predict the subsequent movements in price.
Price signal action trading looks on the movement of price level, seeking to predict the subsequent action as well as strength the price. You can use this strategy in almost any sectors or shares. Of course, I would say stick with substantial liquidity stocks.
So, this type of trading ignores the news, Instead it trades price 'ACTION' Instead of looking at RSI or other second-hand indicators, our main focus is price.
No crazy indicator crap here. Instead, were looking at the most important thing. price. Instead of going crazy with the indicators, we deal with first hand data and price movements around different stocks.
Price action analysis allows a trader to make sense of a market’s price movement and provides him or her with explanations that serve as way for the trader to build a mental scenario to describe the current market structure. Experienced price action traders often attribute their unique mental understanding and ‘gut feel’ of a market as the main reason for their profitable trading.
Price action traders make use of the past history of a market’s price movement, most typically focus on the recent price action of the last 3 to 6 months, with a lighter focus on more distant price history. The price history can sometimes be broken down into sections: days, weeks, months.
A trader can use a market’s price action to try and describe the human thought process behind a market’s movement. Looking at the bars, the stock will leave a clue as to what is happening or what traders think will happen. Also, checking the option chain helps too.
Just Keep it simple
You do not need several technical indicators to trade price.
There are several different acronyms of price action trading such as: clean chart trading, being a chartist, trading the chart specialist.
The simple stripped-down approach of price action trading, means there are no indicators on a trader’s charts and no economic events or news is used in making one’s trading decisions. We continuously think that all the news is in the charts, and the price will move base off of it anyway. Therefore, the implication is that it’s much simpler to just analyze a market and trade from its price action, rather than trying to decipher and sort the many different variables affecting a market each day.
Price Action Trading Strategies (Patterns)
After looking at a chart for awhile, you will notice certain bars that indicate a signal.
Will show you one diagram later.
