Why Price Action?
To make you a consistently profitable trader.
The study of price action gives a trader the ability to analyze the markets with respect to the changes in prices in the recent past. This study helps a trader understand the market structure and identify key demand and supply areas from where any further movement in the price might be speculated with higher probabilities.
The study of price action is not a strategy on its own. It is rather a way of having an understanding of the current market scenario and chooses the correct strategy that would suit it. There are thousands of strategies that have been successfully backtested, but the only way to know the right time to use them is a skill that understanding price action will help you develop.
Furthermore, it is imperative to understand that skill is only 10% of trading success. The other 90% is dependent on money management and trading psychology. Price action will help you identify whether you are an aggressive or a conservative trader as you become more aware of the different levels of risk during trade entries and help you follow effectively profitable money management systems.
- What is Price Action: We define price action and explain how it can be used for maximum profit and minimum loss.
- Buyers and Sellers: Identifying areas of high demand and supply in the market structure.
- Gauging Momentum: To understand the strength in the trend.
- Spikes, Whipsaws and Gaps: How to correctly interpret them and how they can be signals of high importance.
- Candlesticks Reengineered: Using simplified candlesticks. Boring, explosive and rejection candles.
- Timeframes: To understand the location in terms of where the trend is by toggling through multiple timeframes. Like zooming in and out of a map.
CHARACTERISTICS OF A TRADER
- Types of Traders: Every trader is different. One trader’s strategy might not work for another.
- Conservative Vs. Aggressive: What makes a trader aggressive or conservative and why.
- Recognition with Yourself as a Trader: After understanding the characteristics of a trader, the student can recognize what type of trader he/she is and apply strategies that suit their individual mind set.
THE STATISTICAL EDGE
- What’s your number? An exercise to discover how much loss is comfortable for a trader.
- Risk To Reward: Explain the principles of RR and stress on the importance of strict abidance to the laws of RR.
- Trade Management: How to scale your profits and reduce losses while in a trade.
PUTTING IT ALL TOGETHER
- Finding Opportunity: Preparing a trading plan.
- Applying Strategies: An individualized entry and exit system.
- Finding Correlation: Confirming market averages of other correlated stocks and indices.
- Confluence with Indicators and Oscillators: A test to confirm if our price action read is correct.