Getting Started with Price Action Trading

Are you Interested in Learning Price Action Trading? Then, you are at the right place.

Market Secrets is proud to launch a Free 52 Week Training program on Price Action Trading.

This course will be published through YouTube & Blog in the form of 52 Videos/Blog in the next 52 weeks. We are working hard on delivering at least 1 video/Blog each week.

In addition to the videos, we will have tasks, assignments coming your way, so get ready to spend some time on the charts.

Also, we will be using AMIBroker throughout this training on Price Action and as a Precursor we have already launched a training series on AMIBroker. These 2 will go hand-in-hand together.

Link to Amibroker Training Series: https://www.youtube.com/playlist?list=PLRpfTFEfJ27ZKFnzPQ68BPLIDeaWykb6v

Free version of AmiBroker is enough for this training, so download and install it if you haven’t done already. We will provide you all the data you need for AmiBroker in a timely manner.

So, Let’s begin the Training on Price Action  Trading.

 Before you start your epic quest to become a successful price action trader, you have to keep the following aspects close at heart and mind.

1.Watch the videos (or read the corresponding blog) several times, take your time. Do not rush! Each time you watch a lesson you will learn and discover something new that you have not realised or recognised the first time.

Our brain needs time to understand concepts and knowledge to sink in. You cannot expect to speak a new language by reading a dictionary, you also need the grammar, semantics and most of all a lot of practice in applying the words and rules every day. Trading is not any different

2. You won’t be able to learn these rules in a few weeks or months. You need to put in the hard work and effort, the understanding of the rules does not happen overnight, in a few weeks or months, it requires a lot of hard work and focus over a long period of time, 12 to 18 months

3. Every trader has to follow his or her own path to success. To do this you first need to find the strategy that fits your personality. This is the reason why most of the traders are not successful, they trade someone else’s strategy and that strategy might not be the right strategy for them.

4. Remember that there is no “single strategy to success – there is no holy grail that leads you to riches without losses”. A good strategy is nothing more than having an edge in the market. “Price Action Trading” rules provides you with this edge if you diligently learn and practice the rules day in and day out. Having said that, it might not be the right strategy for your personality or you are simply not giving yourself and the strategy enough time to complete this daunting task.

5. You will have setbacks during your learning. Initially you will think that you are progressing on a straight path only to realise that all of a sudden everything seems confusing. You believe you fully understood the concepts and are ready to make profits, just to realise that things are not as clear as they seemed before. You have to go through the stages of belief and disbelief and trust me when I tell you that I have been there many times – too many to remember, but I didn’t have anybody to turn to.

Learning works like this, it’s a natural process, which you can’t speed up or find short-cuts for. Maybe you won’t see patterns popping up in front of your eyes the first time or the second, not even the third time you read a lesson, but you will eventually see them if you don’t let the disbelief stage take over your rational mind and put you down.

Just as price cannot go up in a straight line forever – it needs to pull back to gain strength again – the same happens to your progress. The stages of disbelief in your learning are the times of knowledge consolidation of what you have learnt. Trading, just like any other skill is absorbed through osmosis. It cannot be pushed into our brains. When in doubt of yourself rather step aside for a while and refer other things. When you come back you will see that things will be clearer again.

6. Trading is not a science. It is based on individual and mass psychology. Keep in mind that you do not trade price. What you trade are the emotions of each individual market participant, primarily “Greed and Fear”. These behavioural attributes govern our actions as humans (even when we program computers and write algorithms).

These attributes of human behaviour happen every time and everywhere, whether you trade on a monthly chart or a 1 minute chart, whether you trade the US opening session or the Indian session, whether you trade gold, currencies, stocks, commodities. It is always the same and will always be the same until we progress and become a new species leaving emotions behind us.

Look at a daily chart of a listed company on the BSE in 1980 and compare it with a 5 minute chart today, you could not recognise which is which without having the time and symbol shown. The same patterns and movements happen on every timeframe you look at. As traders, we do not need to have answers to every single scenario that can occur and even if we did have the ‘answer’ to a particular setup – the market (human behaviour) may not agree with us and take an opposing decision

7. Read the lessons and devour, eat, sleep and drink every single lesson. Then do the same again and again and again. Maybe then you will have started to see the logic behind it, let your brain do its job, don’t rush it. This is trading! There are no short cuts!

In today’s episode, I’ll introduce you to some of the commonly used Abbreviations in our Price Action Trading:

You will see these abbreviations throughout the entire series, they are not many but you should be mindful of them

• ATH = All Time Highs
• ATL = All Time Lows
• ATM = At the Money (options)
• BE = Breakeven
• BO = Breakout
• CP = Continuation Pattern
• CT = Counter Trend
• D1 or D = Daily
• DIC = Demand in Control
• DZ = Demand Zone
• ERC = Extended Range Candle (long candles with nice departure, closing at about 80% of its candle range)
• FSZ = Fresh Supply Zone
• FDZ = Fresh Demand Zone
• HL = Horizontal Line
• HTF or STF = Higher TimeFrame or Smaller TimeFrame
• ITM = In The Money (options)
• LML = Last Month Lows
• LMH = Last Month Highs
• LTF or BTF = Lower Time Frame or Bigger TimeFrame
• MN or M = Monthly chart
• OHCL = Open High Close Low candle, that is, the whole candle range
• OOA = Out Of Alignment
• OTM = Out of the Money (options)
• PB = Pullback
• RT = Retest
• RR = Risk/Reward
• SB HL = Solid Break Horizontal Line
• SL = Stop Loss
• SZ = Supply Zone
• TL = Trend Line.
• TF = TimeFrame
• TR = Trade Range
• VHTF = Very High TimeFrame (3M and 6M charts)
• WK or W = Weekly chart
• WoW = it’s a trade setup used as confirmation

I know it is slightly a lot, but believe me, you will get used to it.

If you have been with us for last 2-3 years, you already know that I give lot of importance to trading psychology when compared to trading strategy. So next video will be on trading psychology and after that we will start with technical. You will get some more trading psychology videos as we progress and my only request to you is to give equal if not more importance to the psychology videos.

In addition, I request your feedback, queries and expectations on this Price Action Series. Please share it in the comments section.

Also, Share the link to this blog with your friends if you find it useful.