What do you think is the best (fastest) way to learn PA?

Hello all,

since a while I'm following a trading method which is discussed in a big thread in this forum. The trading system is based on price action, previous price action, chart pattern, S&R, MA's as floating support and resistance, multi timeframe...
Although I'm trading this system since a year or a bit longer I'm far away from reading the charts and PA as perfect as the thread starter or the other "senior trader" in the thread do.

I know it takes time to reach such a comfortable level of mastering technical analysis but what do you think is the best or fastest way to improve the PA/chart reading skills?

I think, money managment it is the key. You must find what suit you best. For example try to rise the win% at the expense of RRR, or quite contrary...

...and dont forget: becareful of new events

Hope this will help you ;-)

The best, fastest way to learn is to put money in the game and lose it. Nothing will motivate you faster...

If you're talking about Price Action there is no greater authority on the subject than Steve Nison...why not read his books. Get your material straight from the original guy who translated the Japanese texts.

It is not hard at all and with a little dedication to study is quite revealing.

watch a low TF chart. 1second-5minutes and the quote panel.

Hi,
I'm aware how important MM, RM and discipline is but that's not the topic of the thread. The problem is I'm not a beginner anymore. I know all the important chart pattern like double tops, H&S, triangles...and I know the most common candlestick pattern. Although I learnt the theoretical stuff I think the way how trader like J16 or EOHater know exactly what's going on in the market is a complete different world.

Reading the Steve Nison books is something I plan for the future

I wouldn't invest in books or any paid subject course or thread. The reason I say this is, everyone who trades "price action" looks at price differently. If you search out thread like J16, you really won't be learning price action. What your learning is how one traders has found entry points in the market and showing all who is interested. That, in itself isn't price action trading but a strategy. You could learn and master it but you would still not have learned PA. I see price action totally different from many traders on FF and vise versa because we all have our own way of searching out entries. PA isn't only knowing about where to play entry's, but about many aspects of reading and interpreting the market.

If you are serious about PA, start off with the basics. Hit Google and learn about Open, High, Low, Close (OHLC). In PA trading that is about as basic as you get. In fact by knowing OHLC you can trade the market without any "systems" or "strategies". Trust me, many pro traders only trade the market based off the OHLC. Remember this, most traders tend to make trading more difficult than it has to be. Simple rule of trading is buy when the market is up and sell when the market is down. By learning OHLC, you'll find that quote holds very true.

Next thing is to "Find your Bar". Learn about candlesticks and Bars (OHLC BAR) charts. Off the bat many traders choose candlesticks because everyone else uses candles. Known fact, 80% forex traders have no idea at how to read candlesticks. So learn the working of candles. Don't forget to learn all about Bars as well. I'm a little biased for Bar charts as they've always been my secret weapon that I never told anyone. You'll see I post a lot of charts in Candlestick form as because that is what most traders are familiar with. I HATE candlesticks. Bar (OHLC BAR charts) are a whole lot easier to read and after you learn how to trade OPEN HIGH LOW CLOSE you may agree with me. The basic idea of Bar chart is, left side of the bar opens high and right side closes low = you got yourself a downwards trend. Vise versa for the other side. Thats how easy it is to read and trade bar charts.

Once you've learned those basics and still feel you need a "strategy", now to you search FF and the web for price action strategies. As I said earlier, every trader is different and every strategy is different. There's only two price action strategies available. Reversal strategies & Continuation strategies. I like reversals, therefore I study the candlestick formations with the high probable chance of a strong price reversals, such as: Dark Cloud Cover, Engulfments, Pin Bars, etc or lean price continuations setups, such as: Advanced Block, Long Bodied, Three Crows, White Soldiers, etc. Also learning price hesitation formations, such as: Dojo, Hammers, Inverted Hammers; learning these formations near a S/R level should tell you the trend is about to change as price is "hesitating" to continue. It never hurts to also learn Sub-strategies, such as: Tweezers (reversal), Double Top (reversal), Head & Shoulders, Cup, and anything else taught in threads and books such as J16.

If you truly want to learn price action, start off with the basics, OHLC. OPEN HIGH LOW CLOSE is really all you need to trade price action. Now, get to studying!!!


TO RECAP:
1) Learn about OPEN HIGH LOW CLOSE on Candlesticks and Bar Charts
2) Decided which is a better fit for you. Candlesticks or Bar Charts?
3)If you decide Candlestick trading is for you, then learn Candlestick formations. Google "Candlestick Patterns" or "Candlestick Formations". Do the same if you decide to trade user Bar charts.
4) Learn a subset of patterns, such as double tops and double bottoms, tweezers, etc.

Here are some links to get you started.:
http://www.thebluecollarinvestor.com...sticks-charts/
http://www.candlestickgenius.com/can..._patterns.html
http://www.candlestickshop.com/glossary/index.html
http://www.investopedia.com/articles...ps-bottoms.asp
http://www.learntotradethemarket.com...ding-strategy/

Find one trade setup that fits your beliefs, just one trade, open a live micro account and search for your trade every day. Use as little discretion as possible at the beginning. Do not search for anything else. If your trade is not there, do not trade. If its there do not hesitate, pull that trigger. After a while youll find you get better and better, until you become the master of it .

Just one stupid trade, thats all you need.

This is the best answer so far. It's amazing how people respond to questions without ever addressing it.

I suggest you get Forex Tester 2. Do as the above suggests, find one setup, and then spend hours on FT finding it. The true problem is that when we look back at a chart it's easy to see setups. Seeing them as they unfold is much more difficult. Using FT is the best way to do this.

fastest way?
not really sure there is a fastest way--
i agree: find 1 market, 1 time frame, 1 setup-- do it
money mgmt: can help a lot
time: i'm sure 10,000 hrs is a decent amount.

best way?----prob the slowest way. assume you won't be good at it for the next 5 to 10 years, but the next 10-25 years can likely make you wealthy for the rest of your life... instead of having high expectations; take the pressure off of yourself. trade with money you could care less about.


best!

Another suggestion: avoid multi-timeframe pattern trading. You can get conflicting pattern signals like shorting on m30 and longing on h4. Stick to longer timeframes or patterns that can give you enough time to anticipate and react. With this way you can have time to get yourself a life(family, friends, dayjob, etc).

Screentime until your eyes bleed

This is one of the best advices for both newbies as well as experience traders, thanks Jhig.

I totally agree with this approach. Seriously.

Anytime!

I've heard James16 is pretty good.

1. Read every book and thread you can.
2. Open a demo account, trade it, grow it on the higher time frames for 6 months
3. Then open a real account.

Laff, post once, get subscribed.

Anyway...

Reading books is fine, but you won't learn how to trade from books. You can learn new concepts, but no book is ever going to make you a better trader.

Forum threads are the same way. They can teach you new concepts, but unless you apply those concepts during a trading session... they aren't going to do anything for you. Some of the most popular threads on here provide the most worthless information.

Talent is a joke. Nobody is born being able to trade.

Screentime is good, you need your 10,000 hours I'm sure. But let's face it, it's more about what you do during those hours than just spending the hours themselves. If you trade on the daily, what are you going to stare at? The same bar, for hours on end? What's that going to do? If you insist on screentime, use it wisely. Run trading simulators, run thru back data, look at market patterns, look at how each pair behaves and has changed behavior over time. Do something productive with it, don't just stare at your monitor.

Demo accounts can help, but demos don't feel the same. Subconsciously, you'll always know it's fake money. You won't feel the pain of losing, with a click you can just make another demo account. Demos are useful, but their usefulness ends well before teaching you how to trade.

You want to learn price action? Let me save you the time. Price action will not make you profitable. Price action is just one way to trade, a way to enter and maybe a way to exit, but it is not the magic answer. Want to learn price patterns? Fine, there's plenty of places to do so. They're trivially easy to find, Google for em. But as someone who has crunched the numbers and has nothing to sell you: they provide no edge. They are just as likely to go up as they are to go down. What's worse, they can go up enough to suck you into a trade, then turn tail and run. Ya gotta know when to hold em, know when to fold em...

The power of price action is not the bar patterns. The power of price action is where you get into the trade, and where you manage your trades at. It's the support or resistence area you pick. It's your ability to pick good support or resistance areas that are likely to yield an order stack. But that's not something you can learn, it comes only from experience. So if you do decide to spend the time learning PA, don't expect the bar pattern jargon to make you rich. It won't. What WILL help you is determining why they chose where they chose to enter, and building that into your subconscious via active trading. That means you have to try, try and fail, over and over, until eventually you get it.

As for the rest, maybe this means longer TFs, maybe it doesn't. Maybe it means using indicators, maybe it doesn't. Maybe it means using a tight stoploss and exiting losers quickly, maybe it doesn't. Maybe it means scaling in, maybe it doesn't. That's stuff you'll have to figure out.

If all you want is to learn PA, eh, pick up a book or something. If you want to learn how to trade, on the other hand, get a cheap Oanda account, dump $100 into it, and trade pennies. At least that's real. You'll lose the money, but think of it as tuition.

The rest is just trivial stuff they sell in books. The kindof stuff that has never made anyone (other than the author) a dime.

Hi Rabbid i agree completely with what you say. PA out of context doesn't mean a thing.I have been trading PA for the past year but I don't find it a very strong edge. I was generally sticking to head and shoulders patterns but its a slow frustrating process! I am still struggling though to be consistently profitable but I was wondering if you were profitable and if so for how long? No worries if u don't want to answer this question- cheers.

I posted an answer, then realized... I don't want to take this thread off-topic like that. It's lame. If you want the answers to this, msg me.