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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