Price Action
The movement of an asset's price over time and the analysis of these raw price movements to make trading decisions
What is Price Action?
Price action is the study of an asset's raw price movements on a chart, without the use of indicators. It focuses on analyzing candlestick patterns, chart patterns, and market structure to understand market behavior and make trading decisions.
Key Concepts
Pattern Recognition
- Candlestick patterns
- Chart formations
- Trend patterns
- Support/resistance
- Price momentum
Analysis Components
- Time frame analysis
- Market structure
- Volume correlation
- Level identification
- Price rejection zones
Trading Applications
Decision Making
- Entry/exit timing
- Stop loss placement
- Target setting
- Trend following
- Counter-trend trading
Common Patterns
- Double tops/bottoms
- Head and shoulders
- Flag patterns
- Triangle formations
- Wedge patterns
Related Terms
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