The sixth lesson

Price action price behavior

Definition of price behavior ( price action): price action depends mainly on the movement of prices for commodities and currencies and analyzes them in order to predict their future course .

There are three prominent strategies for trading on price behavior, namely :

. Triple strike (three Line Strike): this pattern indicates a strong reversal and is formed when three consecutive bearish candles expand in a downtrend, followed by a bullish reversal candle accompanied by a strong trading volume.

2. Evening Star: widely used in price action forex trading, this pattern predicts a reversal from an uptrend to a downtrend. It consists of a large bullish candle, followed by a higher candle that closes on a slight decline, and ends with a bearish candle that diverges from the second candle.

3. Bull Flag Breakout: in this pattern, a long bullish candle acts as a flag pole, followed by several sideways candles or slightly bearish candles, and finally, another strong bullish candle begins to break through.

* - Risks:

Subjectivity: the subjective nature of price action trading can lead to emotional decisions, which can lead to risky trades.

Limited automation: unlike other trading styles, price action trading does not lend itself well to automation, which may require traders to be more trained.