How to Learn Price Action

[ProfLogic]

Quote from HolyGrail:

Below is a 1 point p&f with 3 point reversal.

When I trade futures I trade with this, a .75 chart, and a .5 chart.

When they are all in agreement or close to agreement I pull the trigger. I set my target at the previous low column of 0's if I am short, or the previous high column if I am long.

Here is the comparable 343 CVB chart.

 

[HolyGrail]

I really don't know if it is comparable or not, since I didn't place my buy setups on my chart. I use the .5 chart to enter/exit a trade. I like to enter a break double, or triple top signal on the .5 and I figure where the break will come on the .75. I split the difference and enter the trade.

 

[Lamont_C]

Quote from SoCalTrader619:

Ok... I know that most "successful" traders will agree that Price Action is the basic key to trading. I have been doing a lot of research into price action recently, staring at charts forming, watching the L2, T&S, etc. But sometimes I feel like I don't really know what I'm looking for. I'm hoping that some Price Action traders can chime in and give a bit of advice. What exactly do you look for in Price Action that gives you the information you need to place a trade? What can I do to enhance my Price reading skills? Most say it's hundreds of hours of screentime, but looking for what? I'd appreciate any advice. Thanks!!!

http://www.trade2win.com/boards/pri...upport-resistance-demand-supply-abridged.html

And don't spend all your profits in one place.

LC

 

[SoCalTrader619]

Hey ProfLogic, were those actual trades you took today, or just trades that you would have taken looking back on the fact? Seems like they would have been quite profitable. I'm just trying to figure out why you entered where you did.

Quote from ProfLogic:

Here is the comparable 343 CVB chart.

 

[smilingsynic]

Quote from SoCalTrader619:

Very well put! Gives me a little better understanding on what I'm actually looking for. When reading Price action, do most traders use minute bars (1min), vol bars, range bars, etc? [/B] QUOTE

Minute bars.

Pivot levels, open gaps, recent highs and lows serve as useful targets. Surges of volume reflect that price has hit a critical junction.

 

[SoCalTrader619]

Now I'm all confused. Some traders use minute bars, others use volume bars. I feel that both sides have their perks, but I'd like to use whichever is more effective in learning Price Action.

Quote from smilingsynic:

Quote from SoCalTrader619:

Very well put! Gives me a little better understanding on what I'm actually looking for. When reading Price action, do most traders use minute bars (1min), vol bars, range bars, etc?

QUOTE

Minute bars.

Pivot levels, open gaps, recent highs and lows serve as useful targets. Surges of volume reflect that price has hit a critical junction. [/B]

 

[rjv27]

Quote from SoCalTrader619:

Now I'm all confused. Some traders use minute bars, others use volume bars. I feel that both sides have their perks, but I'd like to use whichever is more effective in learning Price Action.

People use different ways (time, volume, etc..) to look at price. They are all looking at price but with different view points. Just pick one way and learn it well. They all work.

 

[MandelbrotSet]

Quote from SoCalTrader619:

Now I'm all confused. Some traders use minute bars, others use volume bars. I feel that both sides have their perks, but I'd like to use whichever is more effective in learning Price Action.

... and there's the rub.

You're going to have to use whatever speaks to you.

For Prof Logic, there's nothing better than a volume candlestick. That and a cup of coffee just makes his day ... so what he actually needs to see is price and volume

Whereas I realized a long time ago that I had to see price action without the element of Time (because it distorts pure price action), so for the longest time I would only use range bars.

However, there are traders who like to see the price action within the context of a time bar, and I found that when I tried this, I liked the way it felt, so that's what I like to use now (something about the dual bars that takes all the thinking out of the equation).

GL

 

[Bingoking]

Quote from Dustin:

First and best advice I would give to any struggling trader:

For one year you are only allowed to buy strong stocks, and only allowed to sell weak stocks.

If every trader on this site followed this, half of you would be profitable overnight. It's just against human nature so most can't follow the rule.

A veteran pit trader gave me the same advice.
(Have I followed it? NO. Am I profitable? NO.)
(Maybe there is a connection there.)

 

[MandelbrotSet]

Quote from Bingoking:

A veteran pit trader gave me the same advice.
(Have I followed it? NO. Am I profitable? NO.)
(Maybe there is a connection there.)

If you're trading stocks this is the way to go.

Someone mentioned P&F, if you familiarize yourself with Dorsey Wright and their P&F studies, you'll be ahead of the stock trading crowd by a mile.