August 22

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Best Day Trading Strategies Using Price Action Patterns PDF in 2020

One of the Best Candlestick Patterns

Price action trading for me starts with first knowing the proper price action patterns to search for on the charts. That’s why I’ve introduced the day trading strategies using price action patterns PDF. In it, you’ll discover one of the most profitable chart patterns you can look at daily for different currency pairs. Price action alone is insufficient, so I’ll introduce other confluences that help you determine high probability trading setups.

Price Action in Forex

Price action is powerful in finding an entry on lower and higher time frame charts. The day trading strategies using price action PDF will show how lower time frames, those that are used for day trading, require greater confluence than time frames such as the daily.

These patterns must also be recognized immediately to enter a trade at the optimum time without any hesitation. I’ll briefly highlight the necessity of backtesting in order for day trade patterns to become second nature and in order to gain the certetude necessary to trade your plan. I also suggest restricting yourself to the 1hr and 4 hr time frames for day trading, since these are the more accurate time frames compared to the lower time frames.

You should approach the time frames to be chosen in the same way we should approach trades in general, take only the high probability trading setups. This seeking out of high probability trades can be reworded similarly for different time frames. Take only the trades occurring on the time frames that provide the highest probability, the 1hr, and 4hr. It’s your choice to try lower time frames, but you will need to do your backtesting to see if they are worth it for a particular pair.  

Price Action in Forex Trading Needs Confluence

What’s a confluence? A confluence is some other chart or fundamental news feature that supports the price action. Confluences include a combination of round numbers, Fibonacci retracements, candlesticks, support/resistance on the current and higher time frames, overbought/oversold regions, and sentiments due to fundamental news.

Round numbers are numbers such as those shown below. They end in 50 or 00 and provide an added area of support or resistance. The 00 round number, in particular, provides strong confluence.

day trading strategies using price action patterns PDF

Support and Resistance themselves are well known, and my next article will deal with these more in detail. Suffice it to say that the patterns I mention below should coincide with some kind of local support/resistance and even better with support/resistance from a higher time frame such as the daily.

Applying a collection of these confluences together, especially with the fundamental news driver will result in a higher probability trade. Building the habit of patiently waiting for these higher probability trades will result in a winning strategy over time.

 Day Trading Strategies Using Price Action Patterns PDF

The following day trading strategies using the price action patterns PDF are only a few examples of a variety of different strategies that can be used as part of a winning strategy. Noticed that I mentioned “part” of a winning strategy. 

Again, factors such as confluence must be taken into account before applying the pattern. You could use the pattern as a trend reversal or part of a trend continuation strategy. The examples shown in the PDF accessible through the lightbox or link below will only apply to a trend continuation. If you’re interested in an online trading course that teaches this form of confluence, check out the following article: What are the Best Online Trading Courses? Part 1

The Importance of Backtesting

You must apply backtesting for each currency pair and time frame using the day trading strategies using price action patterns PDF accessible through this page’s lightbox or link below. Only then will you see how the patterns in the PDF work and under which confluence constraints. Only then will you be able to apply the correct risk-reward ratios appropriate for each time frame and currency pair.

A typical risk to reward is 1:2. I’ll provide a backtest with approximately a 1:2 risk to reward ratio using a Fibonacci extension, but there are other options for placing an exit target, You can backtest your own using the same price action pattern as an entry signal.

Back test each pair you plan to trade before you try them with real money and continually review this backtesting. Similarly, backtest each time frame individually and compare your results. Start with at least 2 years of data, enough to give you at least 50-100 trials.

On MT4, you can scroll one bar at a time as listed in the Day Trading Strategies Using Price Action Patterns PDF accessible below. The instructions are for a PC running MT4 only. It doesn’t work on a Mac unless you have the MT4 running on a virtual machine.

The one characteristic that cannot be backtested is the fundamentals because they occur on a real-time basis and are too difficult to access in back history. However, they will only enhance the exactitude of the systems. How this can be done requires more articles to address it. Start with the article I’ve listed here.

The price action trading strategies PDF will be emailed to you when you subscribe through this page’s post footer below.

 

 




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  • The first i want to do is try to share this great article with some of my friends. The website is really nice. and i have learnt something tangible from this well detailed article on some of the best trading strategies to use. in 2020. trading online seems to the order of the day due to the effect of covid 19. thank uyou for this tips

    • I wouldn’t delve into trading in hopes of making up for lost revenue due to the COVID 19 crisis. Start on a demo account by doing some backtesting on the longer time frames focusing on areas that seem to show trending price action. You can use the price action pattern I highlight in the PDF below in conjunction with significant support and resistance levels on higher timer frames.

      I would also include pay attention to longer wick candles at these areas of support and resistance as they are a giveaway of possible trend reversals. Include with these the reversal candlesticks I highlight in this article: https://andiamolireforex.com/candlestick-patterns-for-day-trading-pdf/

      Also, make sure you’re buying in oversold regions and selling in overbought regions. The stochastic divergence indicator can help with this.

  • I can tell that this is a really good one. I should first commend the input of effort in making this superb website with nice features and also writing an article on best day trading strategies. using the price action pattern is new to me and i am glad that this is really detailed. thank you very much for this post.

    • Since you’re new it’s best to keep it simple when using technical analysis strategies. Look for a bullish or bearish trend on an upper and then lower time frame, say Daily time frame, and then the 4 hr. After locating the trend focus on the lower time frame and find support zones on an uptrend and resistance zones on a downtrend.

      Look for retracements towards these support/resistance zones. At these locations you can then look for price action using Japanese candlesticks. You can look for outside bars, pin bars, indecision bars, or long wick candles. The best price action I’ve found is what is mentioned in the Day Trading Strategies Using Price Action Patterns PDF downloadable below.

  • This is really nice I am a bit new to trading, I have just been doing it for 4 months now, although I am new to the system I am already catching up with some of the terminologies, one that has been giving issues is price action patterns and after reading this i think my problem would be solved i have already subscribed to get the pdf…thanks a lot for sharing

    • You’ll need more than just price action. You’ll need to use support and resistance, trends, higher time frame analysis. This day trading price action Pdf includes a pattern that works best in conjunction with the trend and has been tested on a particular time frame and currency pair. You’ll have to test it for different pairs and different time frames.

      I would use it in conjunction with those high time frame trends consistent with the lower time frames. The fundamentals can help narrow down what the best trending pair might be.

  • Price action patterns have been one my major constraints when it came to trading I have tried my best to understand it, but to no avail, I would subscribe to pdf maybe I would be able to get a better understanding from reading it thanks a lot for sharing this helpful article I hope it helps others to

    • Whether it’s for day trading, scalping, or swing trading this price action strategy has a high win rate, but only when taken with the trend on both the entry and upper time frame. If you’re using this for day trading I suggest you use it with support and resistance zones for exits and entries. Always confirm the uptrend or downtrend on 2 successive time frames.

  • I can tell you are expert in this field. I am at the point of my career where I want to become an expert in stock exchange and trading. I’ve never been live on Forex, but only used virtual account to get to know the process better. No one have told me about the importance of backstaging. First time I read its importance in your article. I am thankful for this amazing insight.

     It will do much for me when I go live. I will bookmark your website for future posts.

  • Just this morning I and my room mate were discussing about starting forex trading lessons once we finish our exams this November and use the 4 months vacation to get started with online trading. I have no idea how this works at all and these are real deep things I guess I may need to read a little bit of introduction to forex trading to understand about the price action patterns and forex trading strategies. What platform would you suggest if I’m to start forex trading lessons.

  • Hello,

    I found your article to be very informative.  I am kind of new at the trading world but I found that I could understand the information you were giving!  I am further interested in your article about bitcoin! Keep up the great work and I will visit your site again!

    Amy B

    • Than you. Trading Bitcoin is a bit different than trading the forex market. The Forex market has a lot of institutional money involved and so in some ways is more predictable. I’m sure you can apply the price action trading strategies pdf information to Bitcoin, but you’d have to do thorough backtesting.

      Fundamentals don’t have as big a role to play with Bitcoin, but I’m getting to know better what does. You’d have to combine what I mentioned in the article above with those underlying factors to cryptos such as Bitcoin, XRP, Litecoin, and Ethereum. I am more of a long term holder of these assets.

  • Hi, you have a rich content. I’m not really clear about the importance of backtesting. Also, do you have a link to a post on your site that talks about Confluence i.e. the Fundamental news release. I most times want to focus on the technical aspects of the trades. The trend is my friend you know. How do I connect both, technical aspects and the news release. I’m a day trader. Thanks for sharing

    • Even the best price action book fails to mention the importance of confluence, especially with the daily sentiment. The trend is your friend, and I’m sure that you can use strength meters to determine which are the strongest and weakest currencies. However, these meters don’t tell you why these particular currencies are strong or weak or how long these might last. A technical trend line tells you nothing of the underlying reason for the trend in the first place or how long it may last. News sentiment and long term fundamentals help you determine the strong and weak currencies and give you a sense of certainty that is important in taking consistent calculated risks. I have two articles relating to how to do research using news, but I’m preparing a more thorough course to deal with this :

      https://andiamolireforex.com/forex-trade-research/

      https://andiamolireforex.com/trade-like-the-banks-trade-with-forex-fundamentals-analysis/

      A price action strategy is useless without these supporting confluences, especially the fundamentals. I’m sure you can be profitable without the fundamentals, but why make it harder on yourself?

  • Thanks for this informative and useful article on the best day trading strategies using the price action patterns PDF. This was not a long read, and the video helped me understand a lot more about what you are advocating. I have done day trading in the past with success.

    There are some definite things to watch for though, or you can lose money fast. I have had friends who tried trading and lost their money rather quickly. In my case, I followed guidance and went slow using small amounts of money (low risk). Is that also a good way to start using the price action patterns PDF? I am interested and would like to try this method.

  • Sounds like you have some nice strategies, I am curious about a couple. Why only 1 hour or 4 hour time frames? Do you use stop/limits or do you just keep an eye on the stocks and make sure that they do not drop too much? Also, do you only use these strategies for Forex or do you use them for stocks here as well? Thank you for the help!

    • I will usually enter the market on a market order with a stop loss to protect it. I may close a trade early if the market conditions warrant it.

      The download I’ve included above is basically a candlestick patterns cheat sheet pdf for forex. It’s a quick reference that could also be used for stocks as well, but they would have to be backtested for each stock to be certain. These would again be used in confluence with the underlying fundamentals.

      I still trade on smaller time frames than the 1 hour, but only in the case of quick moves such as those after a news report. In general, the higher the time frame the more accurate the price pattern is for entry.

  • I read your article with interest since I day trade Forex almost every day. The two people I follow are Justin Bennett who is a great proponent of Price Action and VP who is more into indicators.

    Since I like to trade the GBP pairs as it allows me to do this before I got to bed living in LA, I like using the 1H London Daybreak strategy. I am sure you must have traded this. What is your opinion of it?

    I subscribed to your website since I am interested in getting your PDF document on Day Trading strategies. My track record is not good. I have been using a $2500 trading account and managed to loose $1000 over a period of two years. This account is mainly to learn. The fact that I have not lost it all means I have had successes, though hard to sustain. The account I have is provided by the Apiary Fund where they train members and when they qualify provide them with their money to trade. You start of by keeping 65% of the profits made in small accounts. If you can maintain three consecutive months they raise the capital you can trade with. The maximum you can go up to is $250,000 of their money.

    It is interesting that Justin Bennett talked about the importance of confluence. And how powerful that can be if recognized. 

    I hope you are doing much better than I am. Perhaps I can learn something valuable from you. 

    Cheers.

    Edwin
     

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