Quote from college_trad3r:
So out of this definition follows price action is real-time. This means there are no backtests possible and you have to believe people on their words you can make money with the magical guru-technique of "watching price action"
So you use technical analysis and money management to create a set-up and just price action for confirmation. Sounds to me you're making money not because of price action, but despite it.
If price action can only be spotted in real-time then break down the movement of the so called price action.
An example you have price at 900, it can move to 900.25 or 899.75 the two possiblities of the range. 900 is a support zone.
Those are the only two possibilities when price is 900.
Then you have the frequency at which it alternates between two prices like 900 and 900.25.
frequency and range are the only two possible attributes of price action, if you discard real-time volume.
However frequency and range do not predict movement of price in anyway. Let's take the example price goes from 902 to 900 fast, stalls at 900, and alternates fast between 900 and 899.75. The alternating to 900+ from 899.75 goes faster than vice versa. Does this mean price wants to go higher?
The answer is it doesn't mean anything. If it does go higher it's not because the frequency is faster, the alternating favors one direction, or because real-time volume increases only when the alternating goes higher on a support. It only goes higher because of the support zone.
Technical analysis trumphs price action, and you know it.
Quote from college_trad3r:
All the time I keep hearing about people trying to make money using price action, here on ET. However I have to remind you guys it is impossible to make money using price action.
Price action does not predict the future, nor does it provide a risk/reward set-up.
The only thing that can do that is technical analysis and money management. Whenever a guru talks about teaching you price action, they lie.Price action is one of the most undefined areas of trading which means nobody knows what price action actually is. Since everybody has a different definition for price action it means price action, unlike tape reading, is a NON-existing occurence in the futures markets. All "price action" is random movement.
What should you do with this information? First of all not give any money to people who promise to teach you price action. Second you should never attempt to learn "price action". The fact that it's undefined means you could waste 10 years of your life learning something that is not price action at all. But that is the only 100% outcome, since price action does not exist.
