Learning to trade with price-action

[lgthomas]

Hi all,

I have been a lurker on these boards for a number of years and found them to be both informative and entertaining. I have mainly been an investor in stocks over the past 10 years or so, but would like to become a trader.

I realise that I have much to learn and intend to use this trading journal as a motivational tool to drive me to learn a little quicker than I otherwise would.

I have seen a number of references to price-action as a trading method, and it seems to me to have some merit. In order to get a grip on this method I intend to read trader_dante's Making Money Trading thread. If any members here would like to suggest other threads on price-action, I would very much appreciate it.

Lance

 

[HawkTrader]

Hi there,

Good luck in your quest to become a trader, here are some good threads on price action, first read this;

http://www.trade2win.com/boards/forex-strategies-systems/75950-trading-naked.html

And then proceed to this, it's still active;

http://www.trade2win.com/boards/forex-strategies-systems/77580-trading-naked-part-2-a.html

All the best!

 

[lgthomas]

Thankyou HawkeTrader,

I will be sure to read those aswell.

Lance

 

[bashatrader]

There are some softwares that data mine price data and uncover math rules based on price action. One of them is APS Automatic Pattern Search. The company is very choosy about whom they allow to download the demo of the latest version of that program so I have not tested their newest indicator of price action they call p-Indicator but I find it very interesting after reading the website paper http://www.tradingpatterns.com/The_p-Indicator.pdf

 

[Xeno]

There are some softwares that data mine price data and uncover math rules based on price action. One of them is APS Automatic Pattern Search. The company is very choosy about whom they allow to download the demo of the latest version of that program so I have not tested their newest indicator of price action they call p-Indicator but I find it very interesting after reading the website paper http://www.tradingpatterns.com/The_p-Indicator.pdf

Hmm.. their APS may be interesting, but their p-indicator appears on first glance to be just a formalisation of backtesting performance for people who don't have a good feel for how to relate backtesting results to an edge. It may be proprietary, but I think a good backtester could come up with it in an hour or two. If they even needed to - a good backtester will already know how good their strategy is.

Consequently, I'm slightly wary of an indicator for sale which may well be a clever dressing up of already established principles. I'm not saying that it's not useful for people who can't be bothered to learn the basics of strategy development and backtesting, but you get so much from learning those basics.

 

[lgthomas]

Just an update.

I have just spent 3.5 hours reading trader_dante's thread and managed to get to page 51. Might take me a while to get through all of it. A damn good read though.

Lance

 

[andys0506]

Just an update.

I have just spent 3.5 hours reading trader_dante's thread and managed to get to page 51. Might take me a while to get through all of it. A damn good read though.

Lance

Its an amazing thread. But be sure to keep it simple. The problem I am having now is I get too fancy. I think the pivot levels - where support becomes resistance and vice-versa are VERY important and need to be identified on your charts before you consider entering a trade.

I wish you well

 

[lgthomas]

There are some softwares that data mine price data and uncover math rules based on price action. One of them is APS Automatic Pattern Search. The company is very choosy about whom they allow to download the demo of the latest version of that program so I have not tested their newest indicator of price action they call p-Indicator but I find it very interesting after reading the website paper http://www.tradingpatterns.com/The_p-Indicator.pdf

As a rookie I think I would benefit far more from visual scanning of charts. I think screen time to train the eyes and mind to identify the patterns of interest is very important. Secondly, I don't want to be buying any form of proprietary software. I want to be able to use any form of simple software to trade with. That's why I am so interested in price-action. Thanks for the suggestion though.

Lance

 

[lgthomas]

Update. Just spent 9 hours on and off reading the "Making Money Trading" thread. Up to page 230 now. The end is in sight. Lots of good stuff here.

Lance

 

[lgthomas]

Finally finished the 'Making Money Trading' thread, all 318 pages. Another 3 hours taken to finish it off. I think I will try my hand at the 'James 16 Chart' thread over at forex factory for some additional info.

Lance

 

[coopster]

Hi Lance,

Good to see your off to what i think is a good start with the TD thread. Try also on Forex Factory the "Silent Service Method" by Clockwork71. Its a very similar, "no indicator, price action with S/R" approach and easier to read than the james16 thread that seems to be just a sales pitch from the first post onwards. Clockwork71 focuses on Forex but the principles are similar. He seems a nice guy too that will still answer newbie questions openly.

I agree with the manual chart scanning. It embeds the principle into your head and means you can take any chart and see its story within a few seconds. If it fits, its shortlisted, if not, skip it.

Do you intend to carry on with stocks or move onto anything else? I'm also very new to trading despite being a member here for 5 years or so. Would be good to share potential setups if our intended markets/timeframes are similar.

I see myself becoming a UK/US stock trader in the near future but never going lower than the 4 hour timeframe to keep the stress to a mininum and give me time to think in between candles and have a life away from the charts!

Good luck to you in your quest. I'll be reading with interest.

Coop