Today is Tuesday, December 29th and today we saw a mild pull back in the Index’s.
As day traders, one important question always comes up, which indicators are the best and which time frame should I use. Let me address the first one here today in this post.
Price Action Day Trading is going to be your best indicator. The reason why, is price always proceeds first and is in my estimation the best indicator to use. Support and Resistance goes along with price and is used to establish boundaries for price. Once those trading boundaries have been broken, market participants will look to establish new boundaries of support and resistance. Area’s of struggle are established and become our road markers in establishing new direction.
All a trader needs to do is learn how to read the signs, but most often we rely on indicators that interpret the price action for us. It is similar to reading cliff notes from a book as opposed to reading the book itself. You will only get a portion of the benefit when you read a summary as opposed to the real thing. The same is true when glossing over the actual price movements of what it is we trade. For me, it is the S&P 500 emini futures.
Learning how the price action is taken up, only to later to be taken down, is something we all need to get familiar with. “Price Is King” when it comes to getting your points and daily goal for the day.
When traders rely on indicators only, it sends them a message that there is a short cut to the end result, that will bypass the work that is needed to understand how price action comes into play, while day trading. The truth is, there is no easy way out.
To become excellent in our field, we need to draw near to those things that we fear. For some it is the fear of more work and involvement. That is the wrong attitude and will eventually catch up to you. As I commented, embrace that which you currently don’t understand and in time, it will become your friend, not something to shy away from.
Try and ask yourself as you look at your indicators, why is this indicator giving me a signal at this time? What just happened within the price action to make it give a signal long or short? Look at it again and again. Keep asking yourself the question why. What is going on at this level of support or resistance that produced a move up or gave you that price rejection?
If you do that, I believe you will be learning far more than you ever would by just following indicators. Don’t get me wrong, I use them myself in my own trading every day, but I understand why and how they work. I understand the reasoning and outcome of the corresponding signals and they are all based on the price first.
They can be a guide for many, but I warn those who solely look and follow indicators as their personal road map. More on this and other topic’s as I am inspired to write over the next few days. For your review, I have the turns posted in a couple of screens. My scalp screen and a higher time frame chart that I use to give me my T-2 turning point signals. You can use this video as your guide and future ones to help you do this exercise.
In the charts I have everything stripped off and only show the basic bar chart. I don’t often show how, what or why my method works so consistently because that is reserved for partners. You can still learn a lot here through my posts and by addressing common real life trading struggles that most traders go through, so stay tuned and good trading.
Related posts:
- Price Action Rules When Trading the Markets
- Price Action Trading Defined
- Price Action Trading – Key to Long Term Success
- Day Traders, read the current price action !
- Price Action Trading & Trading Indicators
Tags: Price Action
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