Do you want to be a master forex trader? It all starts with the right strategy! For example, trading forex using price action might be simple, highly effective and stress-free. In this guide, you will learn how to use price action techniques can be effectively applied. Besides, for help from brokers, choose reputable by checking brokers reviews.
Overview of Price Action Trading
This type of trading strategy was born in 2005 although there has been constant improvement within the last years. It was even able to survive major financial markets changes like the 2008 crisis. So, we can conclude that the strategy has seen it all. It will be your chance to try it.
From trending too low volatile markets to ranging, to higher volatility, this technique has weathered it all making consistent profits.
According to this strategy, all the price movements will depend on the buyers and sellers. If the forex market will be constant, there will be a struggle between the buyers and sellers. So, price action trading will be involving analysis of the one controlling and either the buyer or seller is likely to be in control.
If your analysis will be based on buyers controlling, or even will continue to be in control, it will be suitable for you to buy. For selling, on the other hand, if it will be in control, then it’s better you sell.
Simple Price Action Techniques
How can you analyze the one who is controlling? Here are the types of price action you must know:
Advanced Candlestick Analysis
In this strategy, it isn’t the Doji equals that you might have come across elsewhere. The advanced candlestick analysis will go beyond that such that you will understand fully the way the chart is telling you.
If you will be able to understand that, the chart can indicate who is controlling between the buyers and sellers. So, you will have decided whether to buy or sell.
Support And Resistance Areas
In this type of strategy, it relies on the buy and sells areas that you can easily identify and also place on the chart. If the price will be able to hit this place, you should know that it can hit or reverse completely.
However, it will, therefore, allow you to either buy or sell anytime.
If you consider these two types of techniques, they will make the core of the price action as a trading strategy. In fact, some people find them as the best techniques they can rely on while trading.
Among many benefits of price action trading techniques, don’t expect stress, confusing techniques or indicators. It will all mean reading price and then make smart trading decisions.
Forex trading uses techniques so that it can be simpler in mind. However, there are simple strategies that most investors use. The challenge will be complicating these strategies that lead to their downfall.
However, with price action trading strategy, its core rule is to keep trading simple. It happens because the working best strategies are simple to use. So, if you want to trade without fail, think of simple action trading strategy!