Price action trading the easy way

59 Pages·2017·1.75 MB·English

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Disclaimer
The information contained in this book is for informational
purposes only. I am not a financial advisor. Any legal or financial
advice I give is my opinion based on my own experience.
You should always seek the advice of a professional before acting
on something I have published or recommended.
Please understand that there are some links contained in this
guide that I may benefit from financially.
No part of this publication shall be reproduced, transmitted or
sold in whole or in part, or any form, without the prior written
consent of the author.
Users of this guide are advised to do their own due diligence
when it comes to making business decisions and all information,
products, and services that have been provided should be
independently verified by your own qualified professionals.
By reading this guide, you agree that myself and my company is
not responsible for the success or failure of your business
decisions relating to any information.

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About the Author

Mohan Ghilley is a full time day-trader and investor with a current
preference for cash , Nifty futures and commodity futures
markets. His style of trading is discretionary, operating in the
direction of short-term sentiment within a framework of support
and resistance.
He is a graduate from IIT Roorkee and MBA from IIM Calcutta.
Soon after his MBA in marketing and finance, he fell in love with
stock market and since have been trading full time. With average
to good success in the stock market he has launched this book to
help traders succeed in their trading business
He is the founder and chief contributor to
http://www.YourNiftyCoach.com,
which aims to provide quality trading education and resources
with an emphasis on the ‘less sexy’ but more important aspects of
trading – business management, risk management, money
management and trading psychology.
MG can be contacted via [email protected]

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Table of contents
Contents
Disclaimer ............................................................................................................................................... 0
About the Author ............................................................................................................................... 2
Table of contents ............................................................................................................................... 3
Acknowledgments ............................................................................................................................ 5
Introduction ........................................................................................................................................... 6
Price Action Trading — Support & Resistance are the best levels to trade
on your chart ......................................................................................................................................... 8
Support & Resistance .................................................................................................................. 8
Dynamic Support & Resistance .......................................................................................... 10
Impulse & Corrective move ................................................................................................... 11
The 4 stages of the markets every serious trader must know ............................ 13
Stage 1: Accumulation phase ............................................................................................... 13
Stage 2: Advancing phase ...................................................................................................... 14
Stage 3: Distribution phase ................................................................................................... 15
Stage 4: Declining phase ........................................................................................................ 15
How to tell when the market is trending .......................................................................... 17
Structure of the markets ........................................................................................................ 18
Moving average ............................................................................................................................ 19
How to tell when the market is ranging ............................................................................ 21
Range expansion ......................................................................................................................... 21
Range contraction ...................................................................................................................... 22
How to read the price action of any markets (and determine the strength
and weakness of it) ......................................................................................................................... 23
Slope of impulse moves getting flatter......................................................................... 23
Candlestick bodies getting smaller on impulse move ......................................... 23
Slope of corrective move getting steeper .................................................................. 24
Candlestick bodies getting larger on corrective move ....................................... 25
Stop memorising candlestick patterns, you only need to know these 4
things ....................................................................................................................................................... 29
Wick ..................................................................................................................................................... 29
Length of the wick ...................................................................................................................... 30
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Size of the candle ........................................................................................................................ 31
Close of the body ........................................................................................................................ 32
Advanced candlestick knowledge (that nobody talks about) ............................. 34
Pinbar .................................................................................................................................................. 34
Inside bar .......................................................................................................................................... 40
Price action patterns — Rising three method ............................................................ 43
Price action patterns — Wide range candles .............................................................. 46
Price action patterns — Narrow range candles ......................................................... 47
A price action trading strategy that works ...................................................................... 49
1. Mark your area of Support & Resistance ............................................................. 49
2. Wait for a directional move into Support or Resistance area ............... 49
3. Wait for price rejection at Support or Resistance area ............................. 50
4. Enter on next candle with stop loss below the swing low ...................... 50
5. Take profits at the swing high ................................................................................... 51
A price action strategy to capture momentum and ride trends ....................... 54
Final words from MG ..................................................................................................................... 56
How Much You Succeed is All Up to You ..................................................................... 56
Rome Wasn’t Built In a Day ................................................................................................... 56
Thank You So Much! ....................................................................................................................... 58

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Acknowledgments
Unfortunately I never found one person to act as a mentor. I
consider myself to be self-taught,having developed my trading
approach through trial and error.
That being said, I expect there is nothing new in my approach to
trading that hasn’t been discovered before by others. This is just
my unique interpretation of a blend of information,which has
been gained from exposure to many others throughout my
trading journey.
Numerous traders and educators have had significant influence in
my own trader development.
There are too many to mention in full, however I would like to
offer a special thanks to the following people:
Lance Beggs, Nial Fuller, Mark Douglas, Dr Brett Steenbarger.
Study everything you can find that was written by these people.

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Introduction
Dear Traders
Thank you for downloading my price action strategy guide.
I have one primary aim for this book.
To share with you the way that I view the financial markets and
some of the way that I use price action to identify and manage
trade opportunity.
The strategy shared within this book is a discretionary method of
trading. It is not a simple “buy on trigger A and sell on trigger B”
system. Such simple systems do not work, no matter how much
we wish they did. Spend a day surfing any of the numerous
systems forums and you’ll see this for yourself. Many systems are
presented which appear to offer great potential, generating
excitement amongst the forum participants and a flurry of
posting activity. Ultimately they fade away to nothing as the
participants discover the system fails to deliver consistent results,
or they become frustrated as it morphs into a completely
different system as filter after filter is applied to try to overcome
its limitations.
In the initial chapters I have started with most basic tenants of
Price Action and have moved on to the more advanced stuff on
the later section of the book. Remember I haven’t covered money
management and trading psychology. That will be on my blog but
as far as this book is concerned you will have plenty to learn and
apply.
Most of us think that indicators are the holy grail of the market
and hence they run after every indicators out there and in the end
they return in vain thinking that trading in the stock market is not
for me.
Actually they are chasing shadows and the reality behind those
shadow is price.
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What causes price to move? It is the supply and demand
imbalance and here in this book, we are trying to define this
imbalance in terms of price action. We will trade when there is
imbalance, so that we can capture the movement quick and in
the most efficient way.

So keeping that in mind, I have divided this guide into following
sections
 The best levels to trade on your charts
 The 4 stages of the markets every serious trader must know
 How to identify a trending market without second guessing
yourself
 How to identify a range market easily
 How to read naked charts like a pro and identify “hidden”
strength & weakness
 Quit memorising candlestick patterns, focus on these
instead…
 Advanced candlestick knowledge that nobody talks about
 A price action trading strategy that works

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Price Action Trading — Support &
Resistance are the best levels to
trade on your chart
Here are 4 things you must know:
1. Support & Resistance
2. Previous Support turns Resistance
3. Dynamic Support & Resistance
4. Trending & Retracement move
Let’s begin.
Support & Resistance
Support – An area on the chart, with potential buying pressure, to
push the price higher.
Resistance – An area on the chart, with potential selling pressure,
to push price lower.
Here’re a few examples:

Remember…
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…Support & Resistance is not a single line, but an area on the chart
Next…
If price breaks below support, previous support becomes
resistance.
If price breaks above resistance, previous resistance becomes
support.
Here’s what I mean…

Now:
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