In this section, i will show you different trades examples to help you
understand how to trade the market using all the strategies discussed
in the previous sections.
See the first example below:
As you can see in the chart above, the market is trending down, so as
a price action trader, i will try to follow the trend and look for powerful
signals at the most powerful key levels.
The first signal we got is a pin bar that was rejected from a support
level that becomes resistance.
The second factor that support our decision to sell the market is the
rejection of the pin from the 50% Fibonacci retracement.
The third factor that encourages us to take this signal is the rejection
of the pin bar from the 21 moving average that was acting as a dynamic
The second signal was an engulfing bar candlestick pattern, as you can
see in the chart, this candlestick pattern was formed at a resistance
level in line with the direction of the market.
This is how you can trade trending markets using our price action
signals. It’s simple just identify the trend, and the key levels, it can be
a support or resistance level, a 21 moving averages, or 50% and 61%
Wait for a pin bar, an engulfing bar, an inside bar, or an inside bar false
breakout to form near these levels in line with the direction of the
market, and then execute your trade. It’s not complicated.
See another example below:
As you can see in the chart above the market is trading horizontally
between the support and the resistance level.
This market is completely different from trending markets, and the
strategy to trade it must different as well.
In ranging markets, we trade from the boundaries, i mean from
support and resistance levels, don’t never try to trade inside the range.
In the chart above, we had two powerful signals, the first signal was a
pin bar that was strongly rejected from the resistance level, and the
second signal was an inside bar formed near the support level.
See another chart below:
As you can see in the chart above, there are three powerful pin bar
signals. When the market approaches the 21 moving average that acts
as a resistance level, sellers reject buyers, and form a pin bar that gives
us a good entry point.
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