I hope you have learnt how powerful price action trading can be. Now, not all trading setups you see will become winners.

But here’s the thing…if your losses are small but your profits are large, you will always be in be out in front. That’s why trading risk management is important.

When you are watching the chart for trading setups, you need see and trade the obvious.

Trade-What-You-See-Trade-The-Obvious

What do I mean by that?

Well, if there is an obvious pattern on the chart and you can see it clearly, then you should know that there are thousands of traders out there are watching the exact same thing as you are doing…because it’s so obvious.

Things like:

  • Trendlines or channels or bullish pin bar forming on major support level, if you can see that, there are many that will be seeing the same thing.
  • All these traders will be waiting to see what happens at these levels and say if a bullish hammer forms on a major support level, then guess what will happen next? The most likely outcome of that is that as soon as the high of the hammer candlestick is broken, price will shoot up!

Trade the obvious!

 How many times have you ever went over your chart and you are like:

“Goodness me!  I should have taken a trade here and look at how the market moved after that bearish shooting star candlestick was formed after hitting the resistance level.”

When you trade the obvious, then you trade with what everybody else is seeing and in essence you are really doing piggy-back, riding on the market move created by all these orders that puts the odds in your favour.

See chart below for this: if you see a support major support level and  price is heading down to it and at the same time, that support level is coinciding with an upward trendline…

What does this mean? That’s Confluence buddy! And then you see a bullish Piercing line reversal candlestick form right at the area of confluence.

Are you going to be undecided about  this price signal and pull up stochastic or CCI indicator to really make sure (give you confidence) you need to buy???

Seriously???

NO need for that…Just Trade the obvious!

Trading-The-Obvious-Means-Trading-What-You-See

Keep it simple!

Dont forget to share.

18. Precautions and conclusion with price action trading

16. Multiple Time Frame Trading

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