Forex trading is too technical and difficult for some people, because there are so many technical indicators in trading. One of the most common forex trading strategy is the forex portfolio price action. It is designed to help traders find great trades without using the trading indicators. If you are new to forex trading and don’t want to get involved with trading indicators, you are in luck. We will be discussing how to trade without trading indicators by using price action trading strategies.
All forex traders are trying to improve their trading strategies to get the most benefit from forex trading. However, it isn’t easy to find a simple, useful, and strong price action trading strategy in forex trading. That is why we are going to share how to trade with a price action strategy, which will teach you the important skills of spotting dead zones, red zones, and end zones in forex trading.
Forex trading with price action may look complex and complicated, but if you pay attention to this trading strategy will help you become a full-time trader easily. This strategy is very successful in forex trading, and if you manage to master it, you can run an entire price action trading plan. This strategy is highly recommended for forex traders, but you can always study and implement your own trading style to get the best results when using price action in forex trading.
The important thing you must remember that this is an options trading strategy, a forex price action strategy, and a stock price actions strategy. One of the best things about the complete price action trading system is that you don’t need price action indicators to start trading. This makes it the best trading strategy for traders, who can’t understand or are bad at reading trading indicators.
What is Price Action Trading?
Price action trading is related to finding out how the price will respond and react when placed under different levels of support or resistance. In price action trading, a technical approach is implemented to analyze and learn things related to the price history, and identify resistance areas, past support, trend lines, and the swing high/swing low. It is related to price testing a resistance or support area and could also point to where the price movement helped create a swing low or swing high.
When you use price action you learn that it doesn’t need any moving averages or lagging indicators, which can distract you from the price. It comprises of a clean chart that doesn’t have any confusing technical indicators. It is a simple strategy and has helped numerous traders make profitable traders without ever looking at trading indicators.
To help you properly take advantage of price action in forex trading, we are going to show you how you can trade without using trading indicators. Here is what you need to do:
- Indicators Used
There are some indicators that you can use with price action, which including applying moving averages, Bollinger bands, Fibonacci retracement, RSI, stochastic, MACD, and others on the charts. However, you must search for the red zones using this strategy, and with so many technical indicators, it is easy to get distracted and make a bad trading decision. That is the reason why we recommend not using any indicators when you implement the forex portfolio price action.
- Trading Time Frames
If you are a day trader or a swing trader, you will find that the price action strategy is the best option. That is because the strategy is perfect for anything that requires more than an hours’ time. The only reason we use price action patterns to develop day trading strategies is because the signals of price action are more consistent on their behavior over large time frames. This doesn’t mean that the price action strategy won’t work with scalping, but numerous tests have revealed that the strategy works best when implemented on a one-hour chart.
Price Action Strategy
Now, we get to the most important part of the article, which is focused on discussing the price action strategy. If you want to take advantage of the forex portfolio price action strategy, here is what you must do to be successful in your trades:
- Price Action Setups: The Dead Zone
The ‘Dead Zone’ is literally dead, and you will not find any trader wanting to trade when in the dead zone. The ‘dead zone’ occurs when the price action isn’t moving anywhere, which means that it’s not making lower lows and higher highs. In the ‘dead zone’, the sellers and buyers are at a standoff, and no one is winning. It is a like a soccer match where both times have played out a dull draw with the scores tied at the end of the match.
It is the same in trading, and when you enter trading in the dead zone, you will not manage to win or lose anything because no one is willing to do anything. It is a waiting game, and because you want to win in forex trading, there is no point in engaging or entertaining any trades in the ‘dead zones’.
- Price Action Setups: The Red Zone
The ‘Red Zone’ is where all the action happens, and this is where you will need to make most of your trading moves using the price action strategy. You will notice a lot of movement when you enter the ‘Red Zone’, as this is area where traders need to be sharp and make the right moves to get their objective, which could be a 20, 60, or even a 100-pip winning trade.
- Price Action Setups: The End Zone
Getting to the ‘End Zone’ should be the goal of every forex trader. The ‘Red Zone’ is where all the action happens, but you want to move towards the ‘End Zone’, if you want to maximize profit from the price action strategy. So, how do you find out that you are in the ‘End Zone’? It is when you notice that the market is 10 to 20 pips wide and there is greater room for adjustments. That is perfect for the price action strategy, which requires movement to give out successful results.
When it comes to forex trading, the forex portfolio price action strategy is a great one for a lot of forex traders. It means that they don’t have to study and understand technical indicators when trading, but the only downside with the price action strategy is that you can’t implement it in every situation. During the day, you will only find a few price action setups, but that is when you need to take advantage.
When you find that a trade that is following price action has moved into the ‘Red Zone’, it is a clear indicator that your chances of winning in that trade have significantly improved. It is important that you don’t get carried away with the price action strategy and only use it where necessary, because there have been a lot of traders that haven’t implemented it properly. You need to understand the benefits that price action offers to take advantage of trading without trading indicators in the marketplace.