Top 2 Tips for Price Action Trading
What doesn’t work in price action trading: Checking a lot of data, many time frames and currency pairs.
If you are doing this, you will lose more than you make over time. This is how beginner traders trade and every data points to the fact most beginner traders lose money trading.
If you want to trade like a pro, you need to do what expert traders do, which is shared ahead.
1. Stick to your time frame
Sitting in front of the computer monitor for endless hours is flawed with danger. If you do so, you’re more likely to take a trade which you will repent later.
Once you’ve identified the time frame in which you want to trade, look for a trade setup in only that time frame. If you don’t find any suitable trade setup, simply shut down your laptop and do something else. Don’t go looking for a trade in other time frames, because then you’ll see something that you want to see but isn’t there and take a trade which will make you bleed.
When you first hear of it, turning off the computer when no action is found in your time frame sounds something that’s simple to do. After all, you just need to push the shut down button and that’s that.
However, in reality it is very hard. Beginners get suck into the habit of looking for a suitable setup in multiple time frames. This is because not trading makes them feel restless.
Beginners should limit themselves to daily charts only. Everyday check the daily charts for the price action setups that you’ve learned well for no longer than half an hour. If something favorable comes up, take the trade. If not, get away from the screen until next morning.
2. Create Trading Plans and Keep Trading Journals
Trading is a business and must be run like one. Strategy, reason, discipline, and responsibility are the key words in trading, as in any other business, and there’s no space for emotions.
Create a journal and maintain it regularly. List all parameters as well as each every trade you take. Over a period of time, a glance at the journal will tell if you are within the identified trading parameters or not. It will also tell you which plans are working well and which demand a relook.
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