Understanding Price action is one of the most important skills for day Traders There's a debate between Price action Traders and indicator Traders and who has the better Edge to trade. To me, they are both important to my trading strategies and so in this video I'm going to show you how exactly Price action and indicators Coexist on my trading setup. Welcome back to another humble Trader Strategy video. Are you tired of blindly guessing whether the stock is going to go up or down? Have you been trying to time your entries with no success? Are you getting frustrated because you always get into a trade too late or at a price that's too high? If you answered yes, then you need to learn how to read and trade with this price action strategy.

When I first started trading, I was also wondering how people were able to time the entry so perfectly well. all I knew were just drawing support and resistance levels and just guessing where the next move is. There were many things that I had to learn the hard way before finally flipping my P L from red to green and price action was definitely one of the most important and rewarding one for my day trading trajectory. In this price action extended crash course, you're going to learn step by step the five key points on trading price action.

First Look for overall Market Sentiments using Price Action Trends Second look out for Candlestick Wax aka the breakouts and the breakdowns. Number three time your perfect entries with a golden reversal time frame. Number four: Learn to trade the front side versus the back side. Number five: Understand Trader Psychology behind Price Action trading If you're new to this channel.

I'm a full-time Trader Who's been trading for over eight years now I've shared many trading strategies and videos that are helpful for beginner. Traders There's absolutely no Lamborghini BS Here only some lame jokes about my ex-husband Mike bag holder and of course asking you to smash the like button. Thank you very much. So let's talk about what is Price Action trading and why is this so useful? Here's a Quick Price Action 101 for my new Traders Price Action refers to the Rhythm A stock is moving up and down in prices.

Understanding price action is very important, especially if you're trading short term or any momentum trading or scalping. As someone who's been through the ups and downs of day trading, understanding price action and risk management are two very important Milestones that help me become profitable. One was brand new to day trading. Number one: Understanding the overall Market sentiment using Price action Trends The first step to understanding price Action is to identify the overall Market Trend and direction on a bigger picture.

I'm going to demonstrate my techniques to draw trend lines that are actually useful when trading price action. Now as you can see on the screen, we have two time frames open for the stock. FRC Entry day five minutes on the right hand side and the daily chart on the left hand side. Now the mistake a lot of Traders do is that they always Focus only on the intraday time frame and try to trade.

you know longer or short using the intraday. Trend However, what you need to do is zoom out. So I'm gonna full screen the daily chart, zoom out and look at the bigger picture and use a bigger picture Trend that you see on the daily chart to trade intraday. So that's what we're gonna do right now.

So looking at the stock: FRC First Republic Bank As you probably already know, it's probably one of the banks that's in the center of the spotlight, especially as after Svb fell out. So you can see this stock ever since it broke down of this daily daily. Support Over here at 116. this thing tanked all the way to like 12 dollars.

So you can see this. This needs no explanation. It's a very clear downtrend ever since you broke down that daily support. And when you have extreme downtrend like this example, you have lower lows.

After cracking the key. Daily support, lower lows and lower highs, you can see the recent little Bounce from 18 to almost fifty dollars. This is technically a lower high in comparison to the little spikes from the last couple of days. and ever since then, you have you know, another high here over here around 39 that's once again lower than the 50 range and you are making lower lows cracking through the recent support.

So the most recent support is around twenty dollars over here and today is a day that you cracked below it. So make no mistake, this stock is extremely weak and in a steady downtrend on the dating chart. So knowing about the sentiment for the stock on the daily charts if you're trading the short term on the intraday chart, you got to be careful if you're going long because even on the 15 minute time frame here as you can see on screen, you can see that we are indeed in a downtrend. Even if you are using like the the smaller time frames, you have the highs here 95 gap down to the highs around 50 that we talked about.

So if you Mark that high Mark the high. All of these levels are steadily lower than the one before. so if you're trading these little intraday, you want to zoom out and look at the retest of creating lower highs, so you want to be careful that you're not buying the higher of the day breakout on stocks like these. If anything, these little retests of the downtrend over here These retails are great short selling entries, so if you're sure to hear on this retest of the previous 40 support around 37 40s.

That's a great short. You have a downside to 25s and another little pop here the next day 29 and sold off to 19 and today this morning I Didn't catch this one. It had like a small little pop. Um, that would have been a great short 21s and Faded all the way to 12 dollars.

Remember the bigger time frame Trends is your best friend. If you're trading these intraday on the five minute, two minute or one minute chart, that's totally fine. Just make sure you understand that we are in an overall downtrend. So if you're buying the breakout, that's probably not a good idea using another stock.

AMD as an example. This is an example of a really strong uptrending chart, so in this case you wouldn't be short in the pops like you would on FRC This will be a buy the dip example. Okay so over here on the daily chart for AMD you can see the stock had you know the lows on the year was around like 62 dollars over here and ever since like this thing broke out reclaimed, you held a higher low on 72 dollars and especially after testing the Orange Line The Daily Daily 200. SMA That's the most important Um indicator on the daily chart that a lot of big funds, investors and swing Traders use as the overall sentiment for the stock.

So big. picture wise, if the stock is over the 200, SMA it's considered bullish. so now you can see AMD was finally starting to break out of that 200 SMA pulled back, you know, break under a little bit but really quickly reclaimed a couple weeks ago and now you're making new highs. So when you have these higher lows low here, higher low, second higher low and another one here, that's how you see the uptrend on the stock.

So if you draw a quick trend line here, you can see the stock you know is indeed forming an uptrend over the 200 SMA and zooming in on the intraday charts for AMD Like you can see over here you can see on this day when the stock had the first red day after like multiple four days of green run when you're sold out from you know I didn't open 97 80s down to 93 dollars. You know when all you know hope seems lost. It had a decent decent balance. You can see this thing you know from double the bottom intraday and one for 93 dollars and bounce huge to 95 saying eventually back to 96 dollars.

So this is what we call a V-shape recovery and this usually happens on stocks that's up trading very strong on The Daily charts and had a strong recent breakout. And how exactly do you catch this reversal to the upside we're going to talk about later on in the video. Also, a quick refresher. always look for the bigger picture: uptrend or downtrend.

in this case looking for higher lows right? At least three contact points, One two three. All those lows are higher than the one before and that's how you get this trend line. and if AMD that's a pulls back, you know sell off with the market. You should expect this to pull all the way back from 96 dollars to around like 88 89 to test this uptrend and that's when you can expect a decent dip buy if you were swing trading.

Moving on to the second key point for trading: price action, make sure to look out for Candlestick Wicks for breakouts and breakdowns. Now that you understand how to draw trend lines and look for the overall stock sentiment I'll show you how to use candlesticks to identify price action, breakouts and breakdowns. This is especially true if you're trading momentum and want to avoid false signals. We're looking at the daily charts for the stock coin coinbase, so we want to zoom into the recent action here.

From pretty much the beginning of the year, you can see the stock went through to reclaim that same 200 SMA that we talked about earlier spiked over it to make a high of 84 dollars. I Think Bitcoin was like going to a moon or something at a time and you had a huge pullback. Now up here, that's where you have these little Wicks you can see when the stock went to the highs 85 dollars is sold off and closed at 81 instead and the next day the exact same action it went all the way open down here at 74, went to a high of 87 probably a short squeeze and then sold off and close on a day read at 73 dollars. So when a stock is retesting the highs in this case the highs of around 83 dollars and kept on failing multiple times.

That's when you have this Wix on a daily chart. Now we have that line over here. you can see if you zoom out the wait on a daily chart 83 85 dollars range. if you line it across right, we want to see three contact points once, twice, three times, and actually four times here.

These are previous levels so no wonder you have resistance up here and have false breakouts around the key daily resistance. Now the opposite would be true as well when the stop breaks down and then got Bots back up. So a really good example is after this installed off from like 83.84 down to 55s huge range on the stock, it bounced over a 200 SMA once again to retest the previous highs 72s sold off and then rebalanced back to like 68 70 and sold off to 52 dollars. Now over here when you wanna really look at is all these Wicks at the bottom this time around.

So you have a lot of wigs over here around the 57s range. Remember these wigs. Whether it's upside for resistance or downside wicks for support. They're always going to be rough areas depending on the stock price, right? They're never gonna be exact to the Cent so you know another one down here is 57 and you have a little bit more Wicks down here around the 52 dollars area.

So whenever you see long Wicks at the bottom is the exact opposite as the long wigs at the top like you see earlier. which at the bottom means the weakness is getting bought back up people investors funds. they're picking up the stock for cheap so that's where you have these support around 52 and 57 dollars. Now on the upside, when you have Wicks at the top, it means when the stock tries to break out, sellers stepped in to sell the stock.

That's why you have a lot of selling pressure up here and that's how you have the resistance. So now we understand the basics of Candlestick price action with Wicks on the top and bottom. Let's talk about false breakouts and false breakdowns. False breakouts are like what we said earlier on coinbase when the stock tried to break out through the previous higher day.

so you break through the previous 85 40s clear through that, went to 88 for just a little bit and immediately sold back down. That's how you have a false breakout and false breakouts is generally great short selling opportunities. Now we also have false breakdowns as well. You can see this thing broke down the previous support around like 57.

it broke down to went to 52. So when everything was looking dire and the market seems like it's gonna go down to earth and this thing could potentially go back down to like 44.45 This thing actually reclaimed? You have? You know, if you zoom in here you have a small small breakdown. 51 went down to 50. So that's a small breakdown of one dollar.

That's a really small range for coinbase, but really quickly. you actually have higher volume here, right? Always consider the volume when you're trading the stock higher volume on a day and on the buy side as well. and that's when you have that reclaim. Actually broke through the previous holiday 56 and went to the highs of 60 dollars.

So this is what we consider a false breakdown is when you break down the previous lows for a little bit and you actually got buyers, step in to buy the stock to go up higher and making new highs. and hence that consecutive one, two, three, four, five, six, six days of green on a short squeeze. I Want to show you another example of false breakdown with the stock Nvidia Because a lot of people are really bearish on tech stocks and that's fine. but you want to be careful and so you don't get trapped.

Um, a media. Another false breakdown. Over here you can see the previous lows on the daily chart is 225s area. On this day you broke down to 25 and went to 222, right? So you broke down that key support by three dollars.

Theoretically speaking, you should have sold off even more down to like 215 or 210s. However, because they're strong demand for the stock and they did amazing on the last earnings in February 22nd last month. That's when you have actually buyers step in to buy the stock and weakness. you have the lower candle.

Candlestick Wicks Down here, right? Buyers step in to buy the stock and you actually had a Green Day A lot of false breakdowns are actually followed by consecutive green days. So same idea as coinbase earlier. One, two, three, four, five, six, six days of green days. All the weakness are getting bought back up.

So that's how you know the stock is actually pretty strong. and that's usually followed by false breakdowns. So learning about this kind of false breakdown price action is very important because as short sellers I should sell a lot of stocks. I used to get trapped and I'll get squeezed when the stock actually reclaims to highs.

So I don't want you to make the same mistake if you're ever being a victim. A false breakout or false breakdowns You are not alone I Stand in solidarity with you. but did you know that if you smash the like button right now, your chances of falling for another one decreases by 90 percent? I Know it's magic. Trust me, it really helps if you're enjoying the video so far.

I Really appreciate your support now that you understand how to identify breakouts and breakdowns and avoid false signals. The Next Step I have for you is to time the perfect entries. This will definitely take your trade into a whole new level. Not many Traders will share the Strategic time frame that I'm about to share with you.

Just remember to keep this between you and I Okay, foreign. So going back to the AMD intraday and daily chart that we talked about earlier. you can see on this day when AMD had the first red day stock sold off from 9680s down to 93. this thing had a gnarly bounce all the way from 93 dollars to 96 dollars.

We're talking about three dollars per share on the bounce and we talked about earlier that this is extremely strong in comparison to the rest of the market stocks. So why is it so strong? and how do you time this perfect entry? The first thing you need to make sure to check when trading these stocks and trying to buy and time. the perfect reversal entry like you see this V-shape entry is that you need to make sure that this is a stock that has no fundamentally bearish news so you don't want to be trying to. Long The reversal on this bounce move on the banks like FRC Like we talked about earlier in this scenario, AMD It didn't have any.

You know, company specific Bearish news. It simply sold out off with the rest of the market. A couple other key criterias to remember. No Bearish news.

We talked about that and also, you're on a daily uptrend, right? We talked about this earlier. Quick review: Your stock is breaking above 200 SMA and you're on multiple green days. You are up trending on a daily chart and with a lot of breakouts. So when that's the case for your individual stock that meets all the criteria we talked about, then you want to go in the intraday chart either on five minutes or 15 minutes and you wait for the balance.

That usually happens around 10 30 to 11 o'clock Okay, so this example you can see first red Day AMD Stock sold off all the way to 93 dollars at around 10 o'clock 10 10, 40. Over here, it made the lows a lower day at 93.29 and after that this thing you know, reclaim over the highs. Remember this is a five minute chart. I Don't trade on the one minute or two minutes when it comes to large cap stocks like these.

so you can see the stock broke out about the above. this five minute consolidation range at around 11 o'clock. Once it broke above it, you went to the highs, right? This is a huge balance. We're talking about 93 to 94 all the way to 95 30s.

Now after that, you pull back to make a really clear higher low. Right? This low at 12 o'clock is a lot higher than the one at 10 40.. made the higher low and that's why you have a steady intraday Trend Up Breaking through the previous higher day 95s and went to the highs at close 96 60s. In case this wasn't clear.

if you go to the trend line function here, lining up all the previous lows at 90 to 93 dollars here and 93.90s and all the lows that you're making on the five minute chart. this is when you have a trend reversal. So you have the downtrend of the open first red day on the stock from 97 down to 93 and at 10 30 to 11 o'clock this golden reversal time frame. That's where you have the reversal of the trend reversing to the upside.

So this is a great tip if you're looking to trade reversal during the middle of the day and go long on the bounce. Another example of Tesla you can see today on the same day, it didn't affect any of the criteria like we talked about AMD Meta: It didn't sell off, so that's automatically not fitting for the reversal. Long setup. So really quick refresher on trading this golden reversal time frame and timing.

A perfect entries with this price action. Tips Number one: Make sure your stock doesn't have fundamentally bearish news. Make sure it's a large cap socks that tend to follow the market and wait for your entries. higher lows consolidation on the five minute and look for reversal on the long side around 10 30 to 11 A.M Market Time Number Four Another important part of Price Action Trading is to learn the front side versus backside.

Once you mastered with timing the perfect entries with a golden reversal time frame I Want to show you the technique that I use to better my price Action trading. when trading the front side versus backside, the soul, front side and back side is almost like the mini intraday. Trends Now when you're trading momentum Scalping you definitely need to understand. So on the screen here you see the stock.

Ambi This is a low float small cap stock. like. if you take a quick look at Vimbus you'll see that this thing is in the industrial's waste management industry. Um, not a lot of history on The Daily charts but you can see over here the float is only 2.18 million and the market cap is only 126 million market cap.

So this is definitely a small cap penny stock. so you can see a lot of wigs on the top of the candle right upper wigs here on this day, second day and all the way down to most recent high volume breakout you have the high you know a lot of Wicks around like 22 dollars area. So like what we learned earlier is that we have a lot of Wicks at the top of the candle especially on the daily chart. That means every time the stock tried to break out built and higher or lower volume sellers stepped in to sell the stock.

And if you check out the SEC filing probably has a lot of dilution as well. So so that brings us to intraday. Today when the stock started breaking out, we go to a two minute chart. So I I Love I like to use two minutes when I'm trading a lower float um small cap stocks so you can see this thing actually popped up to no news popped up from like 8 50 all the way to 13 that this is like what a 50 increase within you know 30 minutes.

So when you actually broke down below V Web um this is actually a pretty simple Short Selling Strategy V-wop is my guide for what I'm shorting the stock so I was in this short the stock around like 12 11 60s planning to add if it like keep on selling down below view app forming the intraday downtrend and in that case that would be a backside move right? How do you determine that if you look at the most recent um highs on the stock right? If you look at the daily charts before today the previous highs was here. Around this 11 area you can see eleven dollars Mark and above that you have upside to 14 14 here. So in today, when I'm looking to short the stock I Want to make sure these stocks stay below and stay below the recent key level of 11. So if it did stay below that 11 key level from the daily chart, then that would be considered a backside move then I'm safe to show the little pops risking that 11.

Syria So I'm looking for Eleven Dollars short. Downside to that: Ten dollars. Like eventually nine dollars and potentially even lower. However, when the stock really quickly reclaimed that eleven dollars area and especially if it breaks through V-wap that's a sign that hey, this stock is not done yet.

So if you're shooting the stock thing in this backside, you have to stop out. So if you think about it the other way, when the stock is not staying beneath the key level and not staying in the back side of the move and keep on reclaiming through highs, you can see it didn't get not a similar move around 11 40 reclaiming V-wab into the highs. This is actually front side of the moon. so if you create it really quickly, look at this.

All these intraday higher lows on two minutes are forming into the uptrend. This is true. Even if you are on the five minute chart, you can see higher lows on the five minutes bounce off the 11 key level right away. At 10 30 Down to highs break out, pull back another higher low and close at highs.

So that's how you know the stock is still on the front side of the move into the uptrend like we talked about with at least three contact points one, two, three, four, actually four, four highs. If you're short selling the stock like I was, you definitely want to be careful and avoid shorting the front side of the move. So now that we know what a front side looks like on A and B, I let's take a look at an example of backside. We mentioned this previously.

really. Um, briefly. Um, FRC So how do you know it's the back side of the moon? Very simple. intraday.

You're looking at intraday staying below the daily key level. So if you look at the day today on FRC this thing had a small small support on the daily chart around. Just call it twenty dollars. Round number here: Twenty dollars here.

Previously, this thing bounced off at twenty dollars, right? You can see when it sold out from 90s to 20 is a bounce. That's why you have this long Wick at the bottom of here I Don't know if you can see long Wick here and you have over here another candle. Green Day You open at twenty dollars and everything got bought back up right? So one, two three here. and today, this thing actually broke down that previous support and once the daily support key Daddy support is broken down, that support becomes resistance.

So that's how you have the stock same below that key daily level 20 and you know you can see it's sold off to uh 12.50 This wouldn't happen in stock I would have bounced. No no way. Way too risky. Bounce to 17 lower high the 17 area lower high.

This High here is lower than 20 dollars lower high and sold off into the close. That's how you know this is the back side. If you're on intraday backside of the move, you don't want to go long, you want to be shorting each and every single pop before we move on. If you're enjoying this Price Action Trading video so far, make sure to drop a like down below and subscribe because there's so much more free content coming soon.

Number Five The next thing you should learn about is: Trader Psychology behind Price Action Trading for any trading strategies. Whether you're scalping, learning to buy the dip on my Channel or elsewhere, you should always understand the psychology behind it. Remember, you can master all the technical aspects of a strategy but still fail to execute your setup if you cannot manage your emotions. I've said this many times before in my previous Trader Psychology and Discipline videos.

Technical analysis is only 10 percent of trading. The other 90 is managing your emotions and staying disciplined. You cannot control the market and the market is not always going to move in your direction and that's the reason why trading is a stressful job, but we can learn to avoid human Mistakes by understanding the psychology behind trading and your own trading. Behavior Patterns So here are some of the pro tips I Found to be very useful when navigating difficult emotions in trading.

Number one: Write down your trading emotions per trade. just like how I recommend you keep a trading journal and record all of your entries and exits, profits or losses every time you make a trade. You should also consider making a note of how you feel and your emotions and your mental state when you are trading that ticker. So for example, let's say, you have consecutive red days.

What's happening in your head when you are trading? Those takers. Are you still angry about the fights you had last night with your partner? Are you going through a divorce? I Hope not. But if you are going through a divorce, that's probably affecting the mental part of your trading executions by tracking those human behaviors with your red days and green days. That's when you can start seeing some patterns in your decision making when you're pressing the buy or sell buttons.

So yeah, I Definitely recommend you to record both your emotions, human behavior as well as your actual trading entries and exits and find patterns hand in hand. A second tip for improving your trading Psychology Was reading books on routines, human psychology, and understanding your mind in particular I Find these books to be extremely helpful that have drastically helped my trading over the years. They are: Trader Trader by Queen Tatro trading in a Zone by Mark Douglas and atomic Habits by James Clear I'll leave links to all the books down below but if you're still thinking but Shay I still get really upset and angry when I lose money I Get it. I've been there and I want to tell you it's completely normal I Promise you with practice over time you will get better at managing emotions, but you first have to start tracking it now that you have a good understanding of price action trading.

With all all five of the tips we talked about in this video, you should definitely make sure you have a solid foundation in technical analysis, so make sure to drop a like And subscribe down below if you want to see more. and remember to check out this free technical analysis crash course next on this video.