Five Simple Ways to use Price Action to Trade in Forex
Unlike the stock exchange which is relatively hard to predict, the forex market leaves out several clues that could be pieced together to attain valuable insight. Analyzing these clues can help forex traders in Nepal understand the market better, and arrive at a viable future course of action. A standard approach is to use Price Action Trading (PAT), a form of technical analysis that solely focuses on past prices that have prevailed in the market. What is it? One of the most used Forex trading strategies, price action trading is where traders make all their decisions using a stripped down version of price charts. The logic is simple; global events and economic data influence the price movements in the market, which means viewing the data generated over a period of time on price charts gives all the insight one needs to trade in the market. This approach provides all the necessary signals required to predict the future price movement with some degree of accuracy and to execute a profitable trade. How can it be used? Understanding its language Charts provide useful data on the past movements in price. However, what matters the most is learning to read this data and understand what the market is trying to tell you. You need to learn to ‘listen’ to what price movement is trying to tell you and make decisions accordingly. Observe the closing price