Price action

Price action basics: the 3 building blocks

• Market structure: higher highs/lows vs lower highs/lows (trend direction).
• Key levels: support and resistance zones where reactions often happen.
• State of the market: trend vs range, and how breakouts/fakeouts behave.

Start with structure. Everything else sits on top of it.

A simple top-down price action routine (5 steps)

• Start with structure: mark the latest swing highs/lows and direction → Market structure.
• Mark key zones: draw the 1–3 most obvious reaction areas (not 20 lines) → Support & resistance.
• Name the market state: trend or range? Don’t trade a range like it’s a trend → Trend vs range.
• Check liquidity risk: where would most stops sit, and is a sweep likely? → Liquidity basics.
• Only then look for a trigger: use candles as confirmation at your level, not as a standalone signal → Candlesticks.

Before entering, define your invalidation (stop loss) and size the trade properly (position sizing). Then screenshot + note what you saw → trading journal.

Chart patterns (coming soon)

Chart patterns are recurring price structures like flags, triangles, and head and shoulders. They can help you plan entries, targets, and invalidation — but only when you trade them with context and enough “room” to the next level.

• Continuation: flags, pennants, triangles, ranges, channels.
• Reversal: double top/bottom, head and shoulders, wedges.
• Core concepts: breakout confirmation, targets & invalidation, measured moves.

Common beginner mistake: treating every move like a signal

• No context: trading random candles without structure or a key level.
• Chasing breakouts: buying the top of a range without confirming a real breakout.
• Ignoring liquidity: stops often sit in predictable places—price can “hunt” them before moving.

Good price action is mostly waiting for price to reach your area.