Price Action strategy for every market

NEGI RK Friday, July 07, 2023

First we will see what is price action:

Price action is one type of technical analysis basis on the price movement over the time period. Traders can spot and interpret trends, breakouts and reversals. Many traders use candlestick charts since they help better visualize price movements by displaying the open, high, low and close values in the context of up or down sessions.

Candlestick patterns such as the Harami, engulfing patterns and three white soldiers are all examples of visually interpreted price action. Many short-term traders mainly rely on price action and the formations and trends that help them make trading decisions.

Now will discuss what are the 5 powerful Price action Strategies:

Pullback:

Many short term traders prefer to trade on Pullback.The concept is that you should wait for the price to “pull back” during a trend to get a better entry price. When the market is rising, and you believe it will continue to grow, you want to enter a trade at the lowest possible price. In these market conditions it will be great opportunity to trade on pullback, but make sure that your pull back are supported by volume.

Adding one Pullback chart for better understanding.

Breakout on Pattern:

These are the most reliable breakout patterns one can trade on, because here we will be taking confirmation from Price Actin strategy as well as Chart patterns, make sure that in All the price action strategy volumes should support the movement.

Adding one Breakout on Pattern fro better understanding.

False Breakout:

Many traders will trade on breakout, but some times they can be fake breakouts also, In order to avoid looses double check before trading on false break out. Beginners will all ways fall for this trap and enters what appears to be an ‘obvious’ breakout, only for experienced will double check .

Adding one chart for False Breakout:

Breakout Retest:

As we said earlier many experienced double check the breakout by waiting for retest to happen, Retest confirm us that break out is strong enough and price can be taken as strong support for further up move volumes should support the move as well

Adding one chart for Breakout Retest:

Breakout Buildups:

Some traders will try to take trades when stock is ready for breakout, to Identify the stocks which are ready for breakout this strategy will be helpful, A build-up is a tight consolidation area where we notice that the size of the candles gets smaller. But there is a risk involved here, some times it may lead to false break outs also , so always trade with stop loss.

Adding one chart to identify the Breakout buildups.