Its core price action method is actually no different from the trading tools that Traders usually use. They are all methods that help Traders forecast market reversals.

However, Price Action can give you a deeper understanding of the market, so it also attracts more traders to learn than digging into indicators.

Becoming a Price Action Trader of course cannot be done overnight. You can consider the following 5 steps to visualize what the path you need to take should look like:

1. Accept price behavior as it is

Do you like using indicators, do you like customizing parameters or using multiple trading signals instead of just price? If so, price action is probably not right for you.

The advantage of price action is its simplicity. Don't complicate matters, you need to focus on the price, accept what price action is happening for what it is and let go of the accompanying tools to begin to understand. price action.

An important note before you start: Trading with indicators is not wrong, and price action is not the holy grail of success in the markets. The important point here is the fit, if you feel uncomfortable with it, don't try to pursue this trading method.

2. Start with price action

Once you have the right price action expectations, you can move on to the next stage.

As I mentioned, the essence of price action is simplicity. Don't complicate this method in the first place. Go slowly and firmly.

This means that you should not immediately start with price patterns such as:
  • Head and shoulders price pattern
  • engulfing candle pattern
  • Renko candles
  • Chart point and figure or line chart
  • etc…
Instead, start with:
  • The concept of the closing, opening, high and low prices of a candle (open, high, low, close)
  • The concept of candlesticks and candlesticks
  • The concept of swing points reversal points
  • Resistance and support lines
  • Supply and demand regions

Having a solid foundation will help you understand the nature of more complex price patterns. The logic of price patterns is when you break them down into their most basic components with each candle. I will have an article explaining this clearly.

3. Start replacing indicators with price action.

After you have grasped the basic price action tools, the move to the new trading method will begin.

If you regularly use indicators, it will be a challenge to remove all indicators at once. Instead, you can follow these steps:
  1. List the indicators you are using
  2. For each indicator, write down the purpose for using them
  3. Which behavior from price action helps you achieve the same goal
  4. Alternately, you will completely remove the indicators from the chart
Don't think you're getting rid of indicators, think as if you're repurposing them. Thinking this way is easier and more comfortable.

For example, if you often use the MA50 to identify trends. So what price behavior tells you the market is trending (as the MA50 has informed you)?

Can you replace moving averages with trend lines for the same purpose of identifying trends?

If the answer is yes, you can feel free to give up using moving averages and switch to trend lines. Try to focus on price action as a key tool in this transition, or it's easy to get confused and not know what to do next.

This phase can last a whole year, so be patient with it.

4. Form a trading strategy with price action

At this point, follow these guidelines:
  • Keep things simple: Only use price action methods that you already understand (through step 3 above). Don't try to complicate matters with complicated price patterns or loud-sounding price pattern names.
  • Use only the method of your choice. If you like to trade with pullback price action and feel fine with it. Please continue to use it.
  • Keep the indicator you want: Price Action Trader does not always trade completely smooth and every Price Action Trader has a few favorite indicators. As I often use ATR and MA in the analysis process, but of course you should not let the indicators affect your focus on the market price.
5. Continually use back test and forward test to sharpen your price action trading skills

Trading is a long-term job and a Trader's learning is a lifelong job (at least with Price Action Trading). You will need testing to hone your skills continuously, and learn new skills.

The goal of this step is to develop your intuition as a real Trader. You need to watch the chart and back test continuously, patience and hard work will get you to this stage. Continually answer questions like: which of your methods work? Which method? What can you do to trade better?

At this stage, I recommend using a transaction log to record your analysis. The most important thing here is to observe your change process. Which method have you discovered is better than the previous one? Which price behavior should you give up trading?

In summary, the five steps for you to become a Price Action Trader include:
  1. Accept price behavior as it is
  2. The first step with price action
  3. Start replacing indicator usage with price action
  4. Form a trading strategy with price action
  5. Continually use back test and forward test to sharpen your trading skills
Remember, price action trading is not the holy grail, and these 5 steps are not necessarily the only way to master the skill of price action trading. This is the long road, and you will probably repeat some of the steps, but they are the ones that really work. Be patient, and you will get to your desired destination.