In this video, you will look at a price action trading strategy involving the battle between buyers and sellers. The price movements in the market affects the psychology of the traders and this psychology controls those price movements.
For example, look at this chart. At point 1, the market makes a low. At point 2, the market makes a higher low. At some point, the trend loses force, and then changes direction. At point 3, the market makes a higher low. Finally, the buyers make a double top at point 4.
Buyers attempt to rally one last time from point 5. However, after a break below point 5, it proves to be a supply zone. Now, this point acts like a resistance level. The market makes lower high. You can enter a short trade here with your
Hence, price movements are not just random. You can extract meaninful information by observing price action leading to a good risk to reward ratio for your trades.