Price Action
Price Action is an opportunity to trade on a clean chart without using indicators. It is one of the most effective strategies in the world.
What is Price Action?
Price Action means “price movement” in English. Charles Dow, the founder of technical analysis, argued that the price contains all the necessary information, whether it is economic or political news. Everything that happens to financial markets is encrypted in price movements. For this reason, adherents of this method study the very essence of price movement instead of reading kilometers of news announcements and analytical reports.
Traders have the opportunity to trade on the market taking into account all the events taking place in the world economy, which are already contained in the price. The advantage here is that the trader frees his mind from unnecessary information and has a clear vision of what is happening on the exchanges.
The Price Action system attracts an increasing number of traders and investors for the following reasons:
- It is relatively simple
- It is very popular
- It is universal
First of all, it should be noted that this method is effective in long-term trading, where the main time frame is a daily period. The advantage of this chart is that it eliminates unnecessary market noise in the form of chaotic price fluctuations.
Another advantage of long-term trading is that you spend less time analyzing the market, sometimes 30 minutes of work with the chart during the day is enough.
Trading with the Price Action strategy implies the rejection of indicators, trading advisors, and any other “assistants”. The assumption of further market movement is based on how the price of an asset behaves at that moment.
The working signals in the system are candlestick patterns – periodically repeating figures, called sets or price action patterns.
For traders who use this method, it is enough to perfect a few effective signals to trade consistently for profit.
The only thing you need is the ability to track the appearance of such patterns.