A Review of Price Action based Trades and PG’s Master Class Live Session Analysis:
It was 6th June 2018 at 8:30 am in the morning, we started our analysis for the day with a cup of coffee. As usual we followed some rules to pre-check the market conditions. This is a drill we do every time before we start analyzing any charts.
Some of these rules also helps us to understand where the Market is going to open. Whether there will be a gap up or gap down or simply a flat opening for the day. Based on these assumptions, we derive at a trading bias. This Bias further helps us to find out the Trap Zones. These Trap Zones are places in the chart, where from a new trade (Long or Short) can be taken.
As we align ourselves along with the prevailing correct market trend or bias, that helps us to achieve big Reward to Risk trades in all forms of Trading, whether it is an Intraday or Short Term or Long-Term trade. Unlike Conventional Demand and Supply trading, Price Action based Trading doesn’t go against the true trend. Essentially that is the reason for Price Action based trades to get bigger Reward to Risk, as well as better success ratio’s.
When I talk about True Trend, I don’t mean, following a 50 day Moving Average or simply looking at the Swing Highs and Lows to find the trend. Yes, I know, all of us were taught like that and it is widely available in Google, so any one can read and learn from it. But what is free has some limitations.
And finding the True Trend is not at all difficult using Price Action concepts. This is one of the main ingredient of Price Action based trading. And this ingredient makes “Demand & Supply” and “Price Action” based trading two different technologies.
Price Action based trading has a wider spectrum. It is a mix of many concepts and new researches. But it excludes usage of any lagging Indicators or Oscillators. Yes, you can trade the chart with the help of the leading indicator that is “Price” itself.
So that day we started our drill and concluded to take a Long Trade in Bank Nifty, 5 minutes chart. Hence, we immediately plotted a Trap Zone, where from we expected Bank Nifty to come down first before further moving up.
The Pre-Chart:
Bank Nifty 28 June 2018 series Long Trade in 5 Minutes Chart
Price Action based trading is a type of Retracement trading, where we plot the Trap zones much before and wait patiently for price to arrive at it, to take the trade. The buying is always done by placing a Limit Order.
There are two basic advantage of this kind of trading: 1) you will always trade the Cheapest price and 2) you will have ample time to enter the trade.
This way of trading is possible because of Price Action based Concepts. These concepts helps us to find the Market Turning points, whether it is an Intraday turning point or a Short term or a Long term turning point.
The Post Chart:
As you can see in the below picture, price crashed down first towards our Entry and then as per our expectation, price turned and moved up. A trade which gave more than 6:1 Reward to Risk.
Bank Nifty 28 June 2018 Long Trade Target Achieved.
On the very next Live session we analysed and decided to short Bank Nifty from a 5 minutes Trap Zone.
The Pre-Chart:
Bank Nifty 28 June 2018 series Short Trade in 5 Minutes Chart
And the Result was impeccable, price deeply pierced the zone and then dropped like a rock. That is the power of Price Action, you can take both Long and Short trades with precision. Till now price has given a Reward to Risk of 5:1 with 361 points in this trade.
The Post Chart:
Bank Nifty 28 June 2018 Short Trade working in Favor, 5:1 RR achieved
But it is not to be construed that Price Action Analysis is Limited to Nifty and Bank Nifty, it equally works in Equities, Commodities and Forex.
A Short Trade analysed on IBULHSGFIN during last week’s Live Session:
The Pre-Chart:
IBULHSGFIN Short Trade
And as usual, it worked excellently as per our expectations. There are many more charts we analysed during this time, and most of them worked as per our expectations. And there are also few trades, where we are still expecting to receive a fill in the near future.
The Post Chart:
IBULHSGFIN Short Trade working in Favor, already 3:1 RR achieved.
The Conclusion:
Price Action is the latest and the best Technical Analysis available in the market. No indicators or oscillators are used to analyse Price Action. Conventional Demand & Supply trading and Price Action based trading are two different type of technical analysis. Price Action based concepts can produce very high Reward to Risk trades, like 5:1, 10:1 or even 30:1. And it also produces a very high success ratio, than any other technical analysis available in current market scenario.
Price Action is the best way of trading and I analyse all my trades based on Price Action concepts. So, if you want to get benefited by Price Action based concepts, you can choose to join my “Paid Call Services”. I provide Intraday, Short Term and Long-Term Trades. I am a SEBI registered Research Analyst and my Certificates & Licenses are available in my website Certificates page.
Also, if you are interested to learn “Price Action”, then you are most welcome to join the next batch of “PG’s Master Class” Course. A complete course designed for the beginners. It starts from very Basic level and ends at Advanced Level.
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