Learning to Trade Price Action

To successfully trade Price Action a trader must be able to identify if a market is trending or ranging. Once this has been assessed clear levels for support or resistance must be marked for possible setups to trade either long or short.

Identifying the Trend

Technical traders use can use many different tools to identify the trend such as moving averages, however the best tool the trader has at their disposal is their eyes. After much experience and chart time a trader begins to get a feel for how a market is unfolding and moving.

When learning to identify trends it is always best to start on the larger time frames such as the daily charts. These larger time frames hold the key to all the big moves in the market. The chart below shows the daily chart of the EURUSD which is in a very obvious down trend.