global.gerbangindonesia.org – Basics of Trading Strategy With Price Action . Hello fellow traders, this time the admin will discuss information about the Basics of Trading Strategy With Price Action which not many people know about.
For those of you who are currently curious about the Basics of Trading Strategy With Price Action, we will present it to you below, as follows.
Basically Price Action is a series of price movements over time, and analysis of price action is carried out by observing barestick formations.
Here are some conditions in trading with price action :
1. Up Bar
Also called a ‘bullish bar’, which is a bar with a high that is higher than the previous high (higher) and a low that is higher than the previous low (higher low). A dam from the top of a bar above shows the movement of such a trend.
In general, the closing price of the bar is higher than the opening price, but it can also be lower as shown in the black barestick On the orders of a bar above the picture. But the bars included above as highs and lows are still higher than the high and low levels of the previous bar. Dams that lead to buyers or ‘bulls’ returning to the market.
2. Down Bar
Also called a ‘Harish bar’, which is a bar with a lower than previous high (lower) and a lower than previous level. Lines below the bar above indicate a downward movement in trend A, and indicate that it’s time that sellers or bears’ return to control the market.
3. Inside Bar
The bar inside is a bar with a high level lower than the previous High and a low level higher than the previous low.
Many traders consider a bar with a high or low level to be the same as the previous bar as an entry bar. Bar formation as it indicates uncertainty in a market or country where buyers and sellers are waiting for each other, if it breaks the previous high the buyer will win and vice versa if it breaks the level lower the previous bar, then the sellers win and control the market.
4. Outside Bar
The outside bar is also called the ‘mother bar’, the ‘swallow’ bar in the bar, or in the formation of playing the previous bar swallow. In principle, the outer bar is a bar with a high level that is higher than the previous or previous bar, and a low level of the low level of the previous bar or previous bar.
In the case of candles, the combination of the formation outside the bar and inside the bar is often called a ‘harami’. In the above example the closing level on the outer bar was higher than the opening level, which indicates buyers were in control of the market before consolidation occurred.
Trading Signals From Price Action
The formation of the bars in price action reflects the sentiment of market participants, and can provide an early clue or signal the direction of the next price movement. Signals or cues from price action are usually indicated by the formation of a pin bar which is a bar with a tail (wick) that is longer than its body. A long tail means a strong feeling of rejection on a certain level.
In a state of trending market, pin bars usually show a reversal of the movement from a reversal of the movement or vice versa for the current trend, and pin bars are often called reversals of the said pins.
Factors Supporting Trading Signals From Price Action
In order to avoid possible errors like in the image above, it is very important supporting factors that confirm the trading signal of price action. So, the trader can choose the signal that has the highest probability, which is confirmed by several factors.
Confirmators or supporting factors are support and resistance levels, trend direction and technical indicators. The indicator that is often used is the moving average to determine the direction of the trend. After an example of a trading signal (pin bar) with 3 supporting factors:
See the rod pin formed confirmed by 3 factors, namely: the direction of the trend (downtrend), the rejection of the horizontal line (failed to break this resistance), and also the rejection by the dynamic, i.e. the area between the average and the ema 8. So the probability of a successful entry sell after the pin bar is high.
If it weren’t for the condition of the consolidated sale. Consolidation patterns that General is next (reach), triangle (triangle), pennant, etc. There are times when the market moves within a narrow range with an erratic pattern, this so-called choppy state is difficult to predict and should be avoided. After sample trading signals from price action to trending conditions and ranges:
Prices seem to have broken through the low bar outside, which means reselling is in control of the market. It is also supported by the breakout of the support level.