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Price Action – The Forex Trading Technique That Should Be Learned by Everybody

If someone forced me to pick a forex trading technique above all else to use, it would be price action. No doubt about it. All you need to do is have basic history lesson in trading to see what I am talking about. Some of the greatest technical traders of all time relied solely on the use of price action.

Of course price action does not mean the same thing to every trader. Many traders use the concept of price action differently. But the one universal truth of price action is that you can take patterns in the price and be able to use them to predict future price movement.

This is not all there is to know when it comes to trading forex successfully. Obviously it's a good idea to have a grasp of fundamental analysis, like being able to understand how the news and economic conditions affect the currency market. But when it comes to technical analysis, one thing is for certain, price action is king.

I can speak from experience when I say that I must have tried out or bought every gadget or "magical" indicator that has ever experienced, and it led me nowhere. I could tell I did not know any more about trading than I did when I first started. Exception that this junk does not work.

The instance that it ever dawned on me that all I needed from a technical point was price action, everything changed for me. Instead of using these random and arbitrary indicators, I was the one that was in control. I was able to get a firm granted the forex market, instead of it being translated to me by these lagging indicators.

Source by John Templeton