The price action trading strategy is very popular among forex traders around the world. There are various methods of trading that are built and developed by forex traders.
A price action strategy based on looking for reversal candle patterns is one of the simplest price action methods.
Some also combine it with indicator trading tools. Because there are many kinds of price action indicators, of course choosing the best one will face obstacles because each trader has different psychology.
Price action trading explained
What and how is price action trading called? This is trading is a market analysis method that prioritizes price reactions as reflected by buyers and sellers where historical prices will form certain patterns that imply the possibility of future price movements.
Traders who implement a trading system that relies on trading will read price history from candlestick patterns created by buyers and sellers.
In simple chart theory, one candlestick represents the open, high, low, and close prices. Reading the pattern is usually by looking at the open and close prices in one candlestick.
If the open price is below the close price, the candle shows higher buyer pressure than the seller, and conversely, if the open price is above the close price, the seller’s pressure is higher which causes the market to form a bears candle.
Looking reversal pattern
In the price action strategy, it is important to find a reversal pattern that can be a confirmation signal to create a new entry point.
Best price action indicator mt4
Although basically, This is analysis makes use of candlestick patterns or candlestick forms that become a reference or trading reference. But there are also traders who use indicators as a tool for analyzing price action.
What indicators are best for price action analysis with indicators?
We quote the best indicator for price action trading 2022 from Indicatorchart. There are four best indicators for price action used for MT4 and MT5. This is a custom indicator, meaning that it was created by a third party and in order to use the indicator a trader must have an ex4 file which is then plotted in the indicators folder.
Price action high low swing indicator
This is a custom indicator created based on price action, there are indications for pin bars, inside bars, and engulfing candles. Useful for analyzing price action and assisting in making trading decisions.
By using a combination of MACD indicators and support resistance. This price action indicator, the high low swing indicator, is one of the best versions of the indicator chart.
From the indicator display above, if we observe it has several indicators that are a combination of one trading system. There is a kind of Parabolic Sar indicator that analyzes trends and trend changes through blue and red dots or lines.
Then there are indicators to draw possible support resistance areas based on pivot points. In another window, there are indicators which are like MACD and OSMA.
Price action pattern forex high accurate indicator
This is the next best indicator based on the Indicatorchart review. It consists of several indicators to help price action traders determine how they decide on a trade.
Some of the elements in this indicator are a combination of several custom indicators including Fibonacci Retracement levels. Stop Hunting Zones. Trading Sessions.Mini Dashboard and trend lines.
If we take observe at the indicator display there are indicators that draw support and resistance based on demand and supply. Then there is an indicator display that draws like an envelope indicator which seems to be Fibonacci arcs to determine stop loss and target levels.
While in the new window, there are two momentum indicators to find overbought and oversold price levels.
Price action MDZ True trading indicator
This indicator was created especially for price action trading in the Asian session. Indeed, there are traders who like movements in the Asian market, which although less volatile, the trend is often one-way.
Consisting of a mini dashboard and trendline, this MDZ price action strategy is considered the best MT4 price action indicator by Indicatorchart.
Look at the image above, which is a display of the MDZ trading price action strategy indicator.
As seen in the chart there is a trendline that draws an up or downtrend by taking low to low or high to high. It’s even closer to the Andrew Pitchfork indicator.
The trendline is useful for determining support and resistance. Then there is also the arrow indicator which seems to use moving average calculations for buy and sell signals.
Meanwhile, on the dashboard or new window, there is a momentum indicator that is useful for determining overbought and oversold areas.
By combining price action analysis based on candle patterns, traders can decide when to make a new entry.
Monitor price alert arrow indicator price action
This indicator has an easy-to-understand way of working. When a price action pattern appears, be it a pin bar, inside and outside bars, or shaved bars, an alert will be displayed on the chart.
Traders just monitor the chart and wait for the alerts displayed on the chart to appear.
It will be an easy price action strategy with the help of this candle bar indicator. When a candle bar signal appears, traders can make a buy or sell decision.
It will be understandable with the actual market. It may not be as simple as in trading theory, you have to use a trading plan including risk management.
Best price action indicator Tradingview
Tradingview is a social trading platform where thousands and even millions of traders around the world share ideas about trading from various types of financial markets. Forex, stocks, crypto, indexes, and so on.
You can find price action indicator ideas on the Tradingview platform, but finding the best indicators in Trading view is like finding a needle in a pile of rags. That would be hard to find. However, you can find the best ideas from other traders and help in making trading decisions.
CM_Price-action bars price pattern
This indicator is developed by Chris Moody. A professional trader, this is probably Tradingview’s best price action indicator. Because it gets the most “likes” by traders. If you see it looks the same as a price alert monitor indicator. Maybe IndicatorChart just took the indicator from Tradingview.
If you are interesting to learn about this indicator. You can watch the video from the author at Vimepro.
Chris Moody also has their own website at Chrismoodytrading.com.
This indicator script was created for Tradingview Charts, so to use it on the MT4 trading platform it must be translated into MQL4 language, for this, you need an expert in making EA for MT4.
Price/Volume value indicator
This indicator script was created by dman103 which is a premium member. This is probably the second-best price action indicator as it gets “liked” by almost a thousand people.
This indicator uses a combination of price velocity and volume velocity indicators, plus describes the indicator calculations using a histogram. This indicator was created by dman103 who owns the Algo. win site.
52 week high/low
This is Tradingview’s editor’s choice best price action indicator. Preferred by 800 traders, this simple indicator for measuring highs and lows over a time span of 52 weeks.
This indicator script was created by an account with the nickname BacktestRookies, which also owns the Backtest-rookies.com website.
Multi-Day VWAP v2
This is an indicator created by mortdiggiddy, a premium member who gets more than 500 “likes” from traders.
This indicator measured by a formula that gives the Volume Weighted Average Price. This is to get a bounced signal when the VWAP indicator gives a signal.
The creator of this indicator owns the website Daily-edge.com.
Is price action trading the best?
Price action trading is widely used by traders because this strategy is actually very simple, powerful, and ignores fundamental news. Price action trading analyzes the market based on historical prices as illustrated by candlestick patterns.
Market price patterns that often repeat themselves become one of the bases for traders to make trading decisions. For traders who have successfully carried out a price action trading strategy, of course, this will be the best strategy to collect profits.
Tools that are often used by price action traders, for example, are simple candlestick bar patterns, pin bars, inside bars, breakouts, trendlines, price bands, and/or combinations that include candlesticks, volatility and channels, and so on.
However, as previously described, there are also those who create price action trading by adding a technical indicator tool.
Price action trading strategy will focus on price reversal patterns in the short term, this allows price action traders to trade scalping or short-term trading.
How do you master price action?
The most important aspect to improve price action trading is experience and learning. Focus on support and resistance patterns and only open positions in these areas as a reference.
Look at how the candle pattern is formed, in a strong trending usually the support and resistance areas may breakout. It is always important to use risk management.
To master pr trading, the psychological aspect is also very supportive in learning.
You can try it by always remembering, the simple rule, buy at low and sell at high.
- First, identify the market to analyze the market scenario. Is it trending, moving in a range, or flat.
- The next step, plan your trade, where the target price will be achieved, also at what price will make an order, including a stop loss to plan risk.
- You can make a journal, by recording all the results, both profit, and loss, which can later be useful for evaluating trading strategies. A higher accuracy ratio is considered good for trading. But if the loss is greater than the profit, you can re-analyze your strategy, and correct the mistakes you recognize.
What time frame is best for price action trading?
Many ask, what timeframe, is the best for PA trading. But you will find answers that vary between traders because they have their own comfort side.
Choosing a timeframe is not magic that will give traders everything. Intraday traders, both with combinations and indicators, ideally use H4 and H1 timeframes.
It is important here that you know how much risk you will prepare in the trading plan. It will relate to the distance of the stop loss to the support and resistance and the timeframe.
However, in analyzing the overall market, you can see in all timeframes from monthly, weekly, daily, H4, H1, M30, M15, and M5.
By looking at the entire timeframe you get an estimate of the long, medium, and short term trend.
In short-term trading, often the M15 timeframe provides a better benchmark for trading. Price behavior on this timeframe can be exploited in short-term trades. Mainly in the price range, where the price moves in the swing high and swing low range, it will be easy to measure risk and target according to the chart pattern.
How do you trade the 15-minute chart successfully with price action?
15-minute timeframe ideally for short-term trading. In this timeframe, prices will often go up and down with a higher intensity than the timeframe above.
How to trade the 15-minute timeframe successfully, it is important that you know the areas of support and resistance. The price area is effective with accuracy with high profitability.
In this case, considering a risk-reward ratio of at least 1:1 is good to apply to this price action trade.
Below is a video from the Forex Reviews channel providing a 15-minute timeframe trading tutorial successfully.
Who is the best price action trader in the world?
Maybe you will think the best traders in the world are Americans, like the name Paul Tudor Jones, or Soros and other famous names.
But looking at its history, who is the best trader in the world is a Japanese person. He lived from 1724 to 1803. His name was Munehisa Homma.
It was he who introduced the candlestick pattern that is currently widely used by traders. He is a rice trader from Japan.
Every day he records the price of rice from the open, high and low prices and studies them to analyze the best price he buys rice for. And he was successful with profits that when converted at the current exchange rate of around $ 10 billion. Because of his analytical sharpness, he earned the nickname Samurai trader.
Although simple, the trading strategy is a profitable strategy. But will every trader who uses this strategy all be successful?
Not so, the trading strategy may be the same, but the psychology of traders is definitely different, so the results will also be different.
Warning: Trading forex involves the risk, keeping golden rules, spent money that affords to lose.