Price action is a concept you will encounter a lot in forex trading – the simple reason being this is one of the dominant strategies and approaches to trading – could be trading stocks, forex, futures, options etc.
In essence – and as the phrase implies – price action is the art and science of studying market price movements over time, without relying heavily on indicators and externalities such as news (the type of news that impacts markets).
Price is a relatable approach in trading especially for beginners as it does not over rely on indicators and complicated fundamental analyses. What you need as a price action trader is a reputable broker like Pepperstone and an intuitive charting platform like TradingView – this is a great combo for tracking and trading price action.
What this Post Will Cover:
What Is Price Action Trading?
In relation to the explainer above, price action involves trading decisions solely based on actual price movements. Where indicators are used they are used minimally.
For example you can implement EMA (Exponential Moving Average) 21 and EMA 9 just keep a good view of whether the price action has been bullish or bearish in your chart periods.
If the EMA 9 is running over the EME 21 then you know the price action has been bullish – the opposite simply means the price has been bearish.
The central instruments of your price action trading are candlestick patterns, such as support and resistance zones as well as breakouts.
For these, charting platforms like TradingView offer clean, customizable chart views ideal for your price action analysis.
Why Is Price Action Central in Forex Trading
What makes forex trading a lucrative craft is liquidity.
Liquidity refers to the ease with which a market can be traded without affecting its price. A market with lots of buyers and sellers at any given time is said to be highly liquid because you’d be able to find a counterparty to buy or sell it easily.
Notably, forex is highly liquid, volatile — providing many opportunities for making profits (for traders who know what they are doing and have a solid risk management plan) – forex is perfect for price action strategies.
Trading Platforms like Pepperstone, IC Markets, eToro, BlackBull Markets, Vantage and others are particularly reliable for price action because of their tight spreads and fast execution. This is critical when reacting to pure market moves.
Core Price Action Trading Concepts
Price action trading focuses on raw price (action) or movement and pretty much ignores indicators. Where indicators are used it would be just a few of these.
Below are the critical concepts that every trader needs to master:
1. Candlestick Patterns
Doji: A Doji candlestick signals indecision (price opening and closing near the same level). This candle often precedes reversals.
Pin Bars: A pin bar indicates a rejection of prices particularly if it has a long wick on the current trend direction (upper wick in bullish and lower wick in bearish trends) indicates a possible strong trend reversal.
Engulfing Patterns: A bullish or bearish candle that “swallows” (engulfs – simply means bigger than the prior candle confirms trend shifts.
Note that this does not guarantee that the trend shift will continue or hold after that engulfing candle – hence the need to take in these price actions signals with other broader context price actions like resistance and support key levels.
On TradingView, you can save your favourite candlestick patterns (such as “Evening Star” or “Hammer”) as templates to scan multiple pairs instantly.
2. Support & Resistance Levels
Support: Price floor where buyers step in to push back or reverse the bearish price trend.
Resistance: Price ceiling where sellers dominate to either push back or reverse the bullish run.
Key: The more times price tests a level, the stronger it becomes. So a trade decision based on a combination of all these factors supported by a key level that has been tested multiple times is a high quality trade set up.
3. Market Structure
As a trader you also need to master to the following principles of the market structure
- Higher Highs (HH) + Higher Lows (HL) signal an uptrend.
- Lower Highs (LH) + Lower Lows (LL) signal a downtrend.
- Break of structure (e.g., LH after HH) often signals trend reversal.
4. Breakout & Fakeout Traps
You get a breakout, which is a major price action for traders, when price pushes past a key level with momentum.
This is where you also need to watch for what are called fakeouts. A fakeout is when price breaks a key level but reverses sharply (liquidity grab).
Pro Tip → Always wait for a close beyond the level to confirm breakouts.
Best Tools for Price Action Traders
Price action traders need minimalist, reliable tools. For most of these tools you can get started without any money – making use of free tier accounts and trading with paper money just to master your strategy and craft.
A. Charting Platform
TradingView: This is our top pick for clean and clutter free and intuitive price action charting.
The platform also has capabilities to save critical price action templates such as S/R (support and resistance) levels and various chart patterns for quick analytics.
TradingView comes with capabilities for multiple timeframes (monthly, weekly, weekly, daily, minutes, etc time frames)
Remember: you need to use multiple timeframes (e.g., 4H + 1H) to confirm trends.
B. A Legit Reliable Broker
There are a number of reliable, reputable and regulated brokers you can consider – also based on where you are located, ease of creating and verifying accounts, ease of depositing and withdrawing funds. Our pick is Pepperstone.
Pepperstone is what we use and it is preferred for low latency is trade execution, raw spreads, tight slippage which are critical for trading breakouts. Pepperstone also has direct integration with TradingView – for both demo and live accounts.
It also has a built-in economic calendar for news avoidance. You can also consider platforms like IC Markets, FP Markets, Admiral Markets, BlackBull Markets, eToro as these as some of the reputable brokers as well.
C. Trade Journal
If you want to build yourself up as a successful trader you need to make use of a trading journal. This is crucial for journaling and recording all your trade setups. losses, wins, strategies, etc.
This is crucial for enabling you to improve your craft. Even if you are winning, journaling your trades affords you data driven opportunities to review, refine and optimise.
I use Pepperstone’s TradingView integration for trading, but keep a standalone TradingView tab open for deeper analysis.
My Price Action Trading Setup
I have a Pepperstone account (for low spread pairs and low latency in trade executions) integrated with TradingView for clean price action charts. What I do is map out and mark the key levels (support/resistance) and recent highs/lows.
I then draw my trend lines and horizontal lines to figure out dominant trends, possible reversals and breakouts and where to enter a position precisely. I then watch the price action at key levels.
I have covered this in detail here: What is The Best Price Action Strategy – Simplified for Scalpers & Day Traders
Final Thoughts
So just to recap – Price action trading involves reading the raw story of the market as it is told by price movements. It is a simple concept but takes a lot of practice to master it.
You can get started by opening a Pepperstone demo account (with paper money) and loading up a TradingView chart.
So the first thing is to sign up with both Pepperstone and TradingView and get both accounts verified. Then create a demo account in your Pepperstone account and load it with paper money.
Then you can go into your TradingView account and select Pepperstone from the list of Brokers. A new tab will be opened where you need to punch in your Pepperstone credentials for the integration to run through.
Elias Stroud is a professional forex trader and market analyst with over eight years of experience. His journey began with the common misconception that trading was a get-rich-quick scheme, a path that led to significant early losses. It was this initial failure that forced a pivot towards disciplined, long-term learning and strategy development.
Today, Elias specializes in price action analysis, focusing on identifying high-probability setups without relying on complex indicators. He has cultivated a premium-level trading account, a direct result of his commitment to a structured and professional approach to the markets. Elias is passionate about sharing the actionable insights and foundational principles that helped him transform from a novice to a consistently profitable trader.
For further verification of his professional standing and live trading credentials, please visit the “About Us” page where account confirmation screenshots are provided, along with links to his trusted broker, Pepperstone, and his primary charting platform, TradingView.
