The Financial Ocean
The stock market is a financial ocean which constantly attracts experienced and new traders alike. The potential to make huge financial gains with minimal efforts is what attracts all the fish in this treacherous ocean.
The Institutional Traders are like sharks and the retail traders are the small fish in this ocean. If the small fish must survive in the ocean, they cannot fight the shark head-on. Only way for the small fish to survive is to stay behind the sharks and follow their trail.
In short for retail traders to make consistent returns in the stock market, they simply need to buy when Institutions are buying and simply selling when Institutions are selling.
Key question is how to know when and where the Institutions are buying or selling. If one knows how to read Price Action Clues, one can read the Institutional footprints and with a high degree of accuracy predict the next big move.
Only the smart fish who know how to identify and follow the sharks trail can survive in this ocean.
The Indicator Whirlpool
Most conventional Technical Analysts and traders rely on some or the other lagging indicator or oscillator for their analysis. The reason they rely on these indicators is because most conventional books on Technical Analysis teach only indicator-based trading. A newbie who enters the world of Technical Analysis often is first exposed to the endless list of so-called indicators and oscillators.
All these indicators are freely available on any charting software. Easy and free access to these indicators is the primary reason for new traders to fall into the Indicator Whirlpool.
For a new trader journey begins with trying out some or the other indicator for their analysis. Most of the indicators are just derivatives of Price, so no way they can give a leading signal, they will always lag price. Most of the traders fail to achieve consistent results based on indicator trading. Failure with one indicator-based trading methodology unknowingly pushes the trader into the indicator whirlpool, in the search of the magic indicator. In the endeavour to succeed in trading the new trader tries his hand at various indicators available. In the quest of finding the holy grail the trader just ends up totally confused and making no progress in their trading career. Most traders after spending years in trying out different indicators and strategies have no way to come out from this whirlpool. They get drowned due to huge financial and mental losses, resulting in ultimately giving up trading all together.
Price Action Strategy to follow the Sharks.
Price Action trading is a strategy wherein we don’t rely on any indicator or oscillator for our analysis. Our focus is on reading naked price charts to understand the price action clues.
We rely on Price Action to identify institutional footprints on the charts. These footprints are the areas of supply and demand imbalances caused by big institutions and professional traders. Our aim is to identify these institutional supply and demand zones on a price chart.
We focus on buying at a Demand zone and Selling at a Supply zone, this ensures that we also participate along with the big institutions. This provides us low risk and high probability entry points to time our trades.
Supply and Demand zones clubbed with other factors like multiple time frame location analysis, trend analysis, probability enhancers level scoring methodology gives us a significant edge in our trading.
If you want to be the smart fish and know more about Price Action Trading, enrol for an introductory class.