The Ultimate Guide To Price Action Trading Contents DEDICATION ......................................................................................................................................................... 4 ABOUT THE AUTHOR ........................................................................................................................................... 5 INTRODUCTION .................................................................................................................................................... 6 EVERYTHING YOU NEED TO KNOW ABOUT SUPPORT & RESISTANCE .............................................................. 8 SUPPORT & RESISTANCE........................................................................................................................................................................... 8 ROLE REVERSAL ........................................................................................................................................................................................... 9 DYNAMIC SUPPORT & RESISTANCE ................................................................................................................................................... 11 IMPULSE & CORRECTIVE MOVES ......................................................................................................................................................... 12 THE 4 STAGES OF THE MARKETS EVERY SERIOUS TRADER MUST KNOW ...................................................... 14 STAGE 1: ACCUMULATION PHASE ...................................................................................................................................................... 14 CHARACTERISTICS OF AN ACCUMULATION PHASE: ................................................................................................................... 14 CHARACTERISTICS OF ADVANCING PHASE: ................................................................................................................................... 15 STAGE 3: DISTRIBUTION PHASE ........................................................................................................................................................... 16 CHARACTERISTICS OF DISTRIBUTION PHASE: ............................................................................................................................... 16 STAGE 4: DECLINING PHASE ................................................................................................................................................................. 17 CHARACTERISTICS OF DECLINING PHASE: ...................................................................................................................................... 17 HOW TO TELL WHEN THE MARKET IS TRENDING ............................................................................................. 19 STRUCTURE OF THE MARKETS ............................................................................................................................................................. 20 MOVING AVERAGE .................................................................................................................................................................................... 21 HOW TO TELL WHEN THE MARKET IS RANGING .............................................................................................. 24 RANGE EXPANSION .................................................................................................................................................................................. 24 RANGE CONTRACTION ............................................................................................................................................................................ 25 HOW TO READ THE PRICE ACTION OF ANY MARKETS (AND DETERMINE THE STRENGTH AND WEAKNESS OF IT) .................................................................................................................................................................. 27 SLOPE OF IMPULSE MOVES GETTING FLATTER ............................................................................................................................. 27 CANDLESTICK BODIES GETTING SMALLER ON IMPULSE MOVES ........................................................................................... 28 2 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading SLOPE OF CORRECTIVE MOVES GETTING STEEPER ...................................................................................................................... 28 CANDLESTICK BODIES GETTING LARGER ON CORRECTIVE MOVES....................................................................................... 29 EXAMPLE 1: .................................................................................................................................................................................................. 29 EXAMPLE 2: .................................................................................................................................................................................................. 30 EXAMPLE 3: .................................................................................................................................................................................................. 31 FORGET MEMORIZING CANDLESTICK PATTERNS, YOU ONLY NEED TO KNOW THESE 4 THINGS ................. 33 WICK ............................................................................................................................................................................................................... 33 LENGTH OF THE WICK ............................................................................................................................................................................. 34 SIZE OF THE CANDLE ............................................................................................................................................................................... 35 CLOSE OF THE BODY ................................................................................................................................................................................ 36 ADVANCED CANDLESTICK KNOWLEDGE (THAT NOBODY TALKS ABOUT) .................................................... 37 PINBAR........................................................................................................................................................................................................... 37 INSIDE BAR ................................................................................................................................................................................................... 43 RISING THREE METHOD ..................................................................................................................................... 47 WIDE RANGE CANDLES ........................................................................................................................................................................... 49 NARROW RANGE CANDLES ................................................................................................................................................................... 50 A PRICE ACTION TRADING STRATEGY TO CAPTURE MOMENTUM AND RIDE TRENDS .................................. 52 INSIDE BAR TRADING STRATEGY ......................................................................................................................................................... 52 GUIDELINES: ................................................................................................................................................................................................ 53 FURTHER CONSIDERATIONS TO ASK YOURSELF:.......................................................................................................................... 54 PRICE ACTION TRADING RESOURCES ............................................................................................................... 55 PRICE ACTION TRADING BOOKS .......................................................................................................................................................... 55 PRICE ACTION TRADING BLOGS .......................................................................................................................................................... 55 FINAL WORDS FROM RAYNER ........................................................................................................................... 56 HOW MUCH YOU SUCCEED IS ALL UP TO YOU ............................................................................................................................. 56 ROME WASN’T BUILT IN A DAY ............................................................................................................................................................ 56 THANK YOU SO MUCH! ...................................................................................................................................... 58 3 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading Dedication This guide is dedicated to all traders out there, young and old. You are awesome and I’ll see you on the battlefield. The information contained in this guide is for informational purposes only. I am not a financial advisor. Any legal or financial advice I give is my opinion based on my own experience. You should always seek the advice of a professional before acting on something I have published or recommended. Please understand that there are some links contained in this guide that I may benefit from financially. No part of this publication shall be reproduced, transmitted or sold in whole or in part, or any form, without the prior written consent of the author. Users of this guide are advised to do their own due diligence when it comes to making business decisions and all information, products, and services that have been provided should be independently verified by your own qualified professionals. By reading this guide, you agree that myself and my company is not responsible for the success or failure of your business decisions relating to any information presented in this guide. 4 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading About the author You’ve probably found your way to this guide from my website, or maybe a friend passed it along to you. Either way, I’m happy you’re here. I created this guide because I feel that every trader should learn how to read price action of the markets. By learning how to read price action, you can better time your entries, reduce your risk, and improve your trading performance. Tradingwithrayner and this guide are my way of giving back for all the fortunate things that have happened to me. This guide lays the foundation to price action trading. It is not a “system” and definitely not a “get rich quick” scheme. I’ve given you a trading strategy as well just to get you started. If it can help just one person to get closer to being a consistently profitable trader, then the month I’ve spent writing this trading guide will have been totally worth it. To all my subscribers, followers and friends out there, old and new, thank you for the gift of support. I only hope this trading guide can begin to repay you for all the time and attention you’ve given me. Here’s to you and your continued success! Rayner Teo 5 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading Introduction What moves the market? It’s not because there’s more buyers than sellers. It’s not because of support & resistance. It’s because of buying and selling pressure. Imagine: I want to sell 1 million shares of "Apple." And, at the same time, there are 10 buyers wanting to buy 100 shares of “Apple” each. In total, their buying pressure is 1,000 shares. Now, compare this with the selling pressure of 1 million shares from me. Where do you think price is headed? Down. Why? Because there’s more selling pressure than buying pressure. And not because there’s more sellers than buyers! In this case, there is one seller (which is me) against 10 buyers, but the price is still heading lower. The takeaway is this... Price goes up because there’s more buying pressure than selling pressure. And price goes down because there’s more selling pressure than buying pressure. You can call this price action trading, order flow of the market, supply & demand, etc. But let’s stick to price action trading. 6 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading So, here’s what you’ll learn: ◉ Everything you need to know about Support & Resistance ◉ The 4 stages of the market every serious trader must know ◉ How to tell when the market is trending ◉ How to tell when the market is ranging ◉ How to read the price action of any markets (and determine the strength and weakness of it) ◉ Forget about memorizing candlesticks, you only need to know these 4 things ◉ Advanced candlestick knowledge that nobody talks about ◉ A price action trading strategy to capture momentum and ride trends ◉ Price action trading resources 7 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading Everything you need to know about Support & Resistance They are: 1. Support & Resistance 2. Role reversal 3. Dynamic Support & Resistance 4. Impulse & corrective moves Let's begin. Support & Resistance Support – An area on the chart with potential buying pressure to push the price higher. Resistance - An area on the chart with potential selling pressure to push the price lower. Here are a few examples: 8 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading Remember... ...Support & Resistance is not a single line, but an area on the chart. And when price breaks Support & Resistance, a role reversal occurs. Role reversal Simply put... If the price breaks below support, previous support becomes resistance. If the price breaks above resistance, previous resistance becomes support. Here's what I mean... 9 www.Tradingwithrayner.com The Ultimate Guide To Price Action Trading Now: You've just learnt what Support & Resistance are, and their role reversal with one another. This is "static" Support & Resistance, where their areas are fixed on the chart. But wait, that's not all… 10 www.Tradingwithrayner.com