Trading is a dangerous path that is replete with numerous risks. It can be trodden only by those people who have high risk taking capacities and can act swiftly. This applies just right for stock market trading or forex trading. In both these arenas, there have been many people who have burnt their fingers and have lost all that they have earned here. At the same time, there are a few wise men that have planned scrupulously well and have made riches out of their timely moves. Yes, the main secret to price action trading is to find the Support and Resistance.
When the active trader cannot arrive at these levels on the technical charts and guard his moves, how much every time he invests in trading is a sheer waste of time. Majority of the educators in Price Action are only teaching the interested candidates how they should spot the ideal price action entry. But, the rest of the story is not being taught. For instance, many people do not know the Pin Bar reversal. This one thing can be an extremely powerful signal that will make people earn a lot of profits but if and only if it is placed in the perfect story. If the pin bar is wrongly placed, you can rest assured that it will turn into a disaster. And it is precisely here that support and resistance come in.
It is the identification of the support and resistance points that make the complete price action trading. The entire story is in the charts and the way the charts are read will decide the further course of action. The charts will help in identifying the resistance and support zones. They will be able to identify if the price is struggling to break some key areas. It will also show whether the price has made any fresh lows or highs. The chart will also be able to tell if the price is on a reversal mode, it is making a continuation signal or if the price has broken out of range and is time for going higher or lower.
It is this price action that is considered to be the backbone of any trade. Right from the entry candle to the last candle, everything is crucial. If traders make a foray into this arena without prior knowledge of the price action story, the chances of winning the trades only become bleak.