Section 3: Price Action &
Price action is understanding the common behavior of the market by looking at how it moves on the charts. We'll go through the foundations of technical analysis such as understanding candlesticks, drawing supports and resistances, identifying rend and proper risk management.
Read candlesticks and know how to gauge the current bias in the market as well as use them for trade entry and exit confirmation.
Support & Resistance
When we enter the market, we don't go in randomly. There are significant trade levels called Supports and Resistances where we look for opportunities to trade.
No matter how confusing the market gets, there are only 3 directions it can go: up, down, and sideward. It's best to trade with the general trend to have better chances of getting good trades.
Another way to identify both trend and trade levels are through drawing trendlines. This gives us a more dynamic way of spotting entries and exits in the market.
Risk management is essential in becoming consistently profitable in trading. There will always be wins and losses in the market. It's important to have minimal and controlled risk in order for our accounts to endure the difficult times and prosper when the market gives good trade setups.