The 3-Step Price Action Trading Strategy The Top 5% Use... (It Will Change The Way You Trade)
Published: 2021-10-13
Status:
Available
|
Analyzed
Published: 2021-10-13
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
A trend continuation strategy requires identifying an uptrend by observing higher highs and higher lows in price.
"The first thing I have to do is align myself with the trend... looking for higher highs and higher lows in price."
Pending
After identifying an uptrend, the next step is to wait for price to pull back to an area of value, such as a moving average or a tested structural level.
"Step number two ensure that price pulls back to an area of value whether that be something like a moving average or something like a major level of structure that's been tested multiple times"
Pending
The third step in the trading strategy is to look for buying pressure, which can be indicated by a large green candle, after price pulls back to an area of value in an uptrend.
"Step number three is nothing more than look for buying pressure... in this case that's literally what I used this big green candle showed me buying pressure on the pound yen coming out of an area of value"
Pending
The effectiveness of a trend continuation strategy is significantly improved by limiting trades to instances where price bounces off a higher time frame level of structure, to avoid poor performance during consolidation.
"This setup if you trade it every single time it ever happens... when the market's consolidating you're gonna do really badly... if you limit the times you take this trade to only when prices bouncing off of a higher time frame level of structure"
Pending
The three-step trading process involves establishing a directional bias (trend), identifying higher highs and lows, waiting for a pullback to an area of value, and then confirming with buying pressure.
"The three-step process which simply is waiting for price to be in a particular trend... then after my directional bias all I'm looking for higher highs and higher lows after that I want to see price pull back into an area of value... and after that I want to see buying pressure"
Pending
Good trading psychology allowed the trader to enter a profitable trade after a losing streak, resulting in a significant positive swing in their account.
"The first four trades I lost... eight thousand dollars on this one I won close to ten grand... a ten percent swing in my account due to nothing more than good trading psychology entering a trade"
Pending
Having confidence and belief in a trading strategy is crucial to avoid mistakes and achieve profitability.
"We must have confidence, we must have belief in the system or strategy that we're trading. If you don't have belief in that strategy you're going to lose... you're going to make so many mistakes if you don't have belief in your strategy or system"
Pending
Fear in trading leads to emotional mistakes, hindering profitability.
"If you're constantly scared and in a state of fear when you place trades then you are constantly going to make emotional mistakes."
Pending
To build belief in a trading strategy, it must be rules-based, allowing for consistent application and practice until it can be executed flawlessly and its profitability is demonstrated.
"Your first step is to have that rules-based strategy have a strategy have a set of rules you can stay consistent to... your belief is going to come down to you seeing it work you practicing it to the point that you can trade it over and over"
Pending
Backtesting, while time-consuming, is a significantly faster method to gain experience with a trading strategy compared to relying solely on real-time trading over years.
"Back testing takes a long time but in order to gain that much experience in real markets it would take years in order to gain that much experience with a specific strategy if you're not back testing"
Pending
Backtesting provides essential practice for quickly identifying trading patterns and demonstrates the strategy's profitability over a large sample size, thereby increasing confidence and belief.
"Back testing is going to give you that practice you need for you to be able to spot the pattern quickly... it'll show you out of a large sample size if this specific strategy made money or not and you seeing the fact that it made money... is going to increase your confidence increase that belief factor"
Pending
Demo trading, when conducted with a specific trading plan and adherence to rules, can further increase belief in a strategy if profitability is achieved over a month.
"Demo trading... if you're seeing yourself go in and out of trades in a live market situation for let's say a month and you come out the other end of that following all of your rules... and you're profitable throughout that month you're going to have even more belief in your strategy"
Pending
Fear in trades is often a direct result of poor risk management or risking too much capital.
"The fear you have when you are in a trade only comes down to a couple of things... you're risking too much when you're trading your risk management is off."
Pending
Decreasing fear in trading is achieved by reducing the amount risked per trade, with the speaker personally risking 1-2% of their total account value.
"The way we decrease fear is by risking less per trade... Personally I risk between one and two percent of my total account value per trade."
Pending
Mastering trading psychology and risk management will dramatically increase a trader's chances of success.
"If you accomplish those two parts of your trading [trading psychology and risk management] your chances of success will skyrocket."
Pending