Advanced Price Action Analysis
In this article, I am going to discuss the Advanced Price Action Analysis. This is a sequel part of our previous article, so please read our previous article before proceeding to this article. As separate of this article, I am going to discuss the pursue pointers in detail .
- What is high and low?
Reading: Advanced Price Action Analysis
- What is the swing high and swing low?
- Criteria for drawing swing high and swing low
- Types of swing high
- Strength and Weakness of Trend through Analysis Swing.
Before going forward let me know that, This is the extension depart of price carry through analysis. so I would suggest going through the previous article
How to Study Candlestick
Price Action Analysis
Let ’ s begin
Understanding Market Structure through the swing
It is like to learning to read a newfangled alphabet-once you understand the characters, you can read the words, and once you know the words you can read the report. The first letter to master tells you what market activity causes the formation of a short-run high or abject. If you learn this basic steer, the meaning of all market structures will begin to fall into station .
The market moves in the up-down wave, what we call a market swing. In a healthy taurus vogue, the upswing generally exceeds the downturn in length, the overrule is true for the have a bun in the oven grocery store. Hence by observing market swing, we are able to glimpse into the structure of the grocery store and get clues on whether the market will move improving or depressed
Swing high gear and swing depleted
Criteria for drawing swing high and swing low
swing HIGH Or SWING LOW CONSIST OF MINIMUM 5 BAR. The middle stripe must be higher high and higher low then the two go prevention and the two following banish
Restriction for drawing swing high and swing low
- If bars high is parallel to the middle or high ( LOW ) bar, it does not count as one of the five bars in the swing HIGH ( LOW ) because it does not have a lower high ( HIGHER LOW ) than the middle banish
- TWO ADJACENT swings high or swing low may plowshare bars
- A swing high
- B both swing senior high school and swing low, this happens because two proceeding bar and two following bar are inside bars, that fulfills the necessity of the in-between measure must be the highest or lowest point of five banish sequence
- C both up and downswing by sharing browning automatic rifle
- D requires six-bar to form swing high as the fifth browning automatic rifle is peer high to the center bar
Why crucial ?
These points not random, they created by the market. they represent fleeting changes and need and provide forces. The bulls could not move the market above the swing high. This means that at that orient in fourth dimension, no one was volition to offer a price higher than the swing high. Traders saw no measure above the swing gamey
In a nutshell, there are two key skills in reading price action:
- Evaluate how likely a swing pivot will hold up as support/resistance
- Understand the implication of a swing pivot not holding up as support/resistance
There are two types of swing
- high and gloomy
- Swing high and swing low
Let me explain to you
Swing broken ( SL )
The market tried to move down. then, it stopped and the bullish vogue resumed. The commercialize broke all resistor ( swing high ) and made a newly drift high. In other words, the market failed terribly in its attack to move down. The lowest point it pushed to is called swing low
tip : valid pivot makes sense alone within the swerve price action. To find a valid low, you need to know the beginning point of the vogue and the last extreme point course gamey. then what about point B. distributor point B called a LOW not swing moo
Every major market has some pullback that is shallow and some last for one swing. The point where pullback goes deeper and lasts for more than one swing, forming a LOW. finally, this deep pullback terminated and the vogue resumed. A low becomes a swing low once the price breaks out above the death extreme point price high for the resumption of the bullish vogue. Let me explain to you
All the concept are discussed above are applicable for a swing gamey and high
HOW TO KNOW WHEN LOW BECOME SWING LOW
When the price cleared the above swing senior high school level. To clear a price horizontal surface, the market must form a price bar that is wholly above the price level. This means if a legal profession low is higher than a price grade, the market has cleared above the price flush .
understand MARKET SWINGS in Advanced Candlestick Analysis
We have silent how to find out swing high gear and swing low
Let understand STRENGTH AND WEAKNESS OR TREND THROUGH ANALYSIS OF swing
- Thrust and pullback
What is Momentum ?
The rate at which price move with respect to time
We are merely respect monetary value action in orderliness to compare the current speed and acceleration of price motion with historic rush and acceleration. Momentum is visible on a chart by observing the gradient ( fish ) of price drift
The like concept applies to price natural process on charts. Changes in momentum are observed through changes in the slope ( angle ) of the price action Analysis of momentum is not about measuring any absolute value of momentum, but in making a comparison of current price action momentum with prior price action momentum.
WE can compare through
Momentum through candle
Compare the momentum of the current candle with the momentum of the previous candle
- Counting the total of bars in a half cycle and comparing one-half bicycle to another ( former half cycle )
- Comparing each swing ( relative military capability of move )
- How much time to get up or how a lot meter to get down
Momentum through swing
- Compare the momentum of the stream price swing with the momentum of the previous price swing in the lapp direction ?
- Compare the momentum of the stream price swing with the momentum of the previous price swing in the face-to-face focus ?
- Is the current monetary value accelerate or decelerating ? What does that mean ?
1 ) Compare the momentum of the current price swing with the momentum of the previous price swing in the same direction ?
now let ’ s remove the downswing and study what it is showing Is price faster or slower than before?
Compare the slope of UP-swings ( a ), ( degree centigrade ) ( vitamin e ) and ( guanine ). Note the decreased speed on each of these legs, indicating a decrease in bullish momentum. Weakness is appearing on the bullish side .
Clearly shows upward momentum decreasing
now putting the lapp chart with only downward momentum
Compare the slope of upswings ( B ) ( D ) ( F ) and ( H ). Note the increasing speed on each of these legs, indicating an increase in bearish momentum. bearish price swings are showing signs of force .
BY COMPARING THE SWING IT indicating an increase in bearish momentum. bearish price swings are showing signs of military capability. The price bowel movement is more likely to continue in the steering of force and against the guidance of weakness .
2 ) Compare the momentum of the current monetary value swing with the momentum of the previous price swing in the opposition guidance ?
That is, comparing the current bullish swing with the previous bearish swing ; or comparing the current bearish swing with the former bullish lilt. Note the slope of ( a ) is quite steep compared with the slope of ( b ). The latest upswing ( bacillus ) has shown helplessness compared with the former downturn ( a ). Strength is even in the bearish direction .
bullish upswing ( five hundred ) shows an increase in speed compared with the last downturn ( speed of light ). While the lastingness is nowadays to the bullish side. The shallow angle of downward momentum compared with the steep emanation of upward momentum bespeak Strength is now clearly on the bullish side .
The monetary value movement is expected in the steering of potency and against the direction of weakness .
3 ) Is the current price accelerate or decelerating ? What does that mean ?
The deceleration in this example is tell of bullish momentum gradually weakening as bearish atmospheric pressure overcomes any bullish press .
In the following article, I am going to discuss Thrust Pullback and Measuring Move Analysis in Trading. here, in this article, I try to explain the Advanced Price Action Analysis in Trading. I hope you enjoy this article and understand the Advanced Price Action Analysis concept. Please join my Telegram Channel to learn more and clear your doubts. https://t.me/tradingwithsmartmoney.