Forex Trading Strategies with Price Action

How To Understand Market Manipulation And Become
Profitable By Understanding How To Read A Chart Like The “Smart Money”

A typical 1-2-3 high is formed at the end of an uptrending market. Typically, prices will make a final high (1), proceed downward to point (2) where an upward correction begins; then proceed upward to a point where they resume a downward movement, thereby creating the pivot (3). There can be more than one bar in the movement from point 1 to point 2, and again from point 2 to point 3. There must be a full correction before points 2 or 3 can be defined. A number 1 high is created when a previous up-move has ended and prices have begun to move down.The number 1 point is identified as the last bar to have made a new high in the most recent up-leg of the latest swing. Forex Trading Strategies with Price Action.

The number 2 point of a 1-2-3 high is created when a full correction takes place. Full correction means that as prices move up from the potential number 2 point, there must be a single bar that makes both a higher high and a higher low than the preceding bar or a combination of up to three bars creating both the higher high and the higher low. The higher high and the higher low may occur in any order. Subsequent to three bars we have congestion. Congestion will be explained in depth later on in the course. It is possible for both the number 1 and number 2 points to occur on the same bar. Forex Trading Strategies with Price Action.

The number 3 point of a 1-2-3 low exists when a full correction takes place. A full correction means that as prices move up from the potential number 3 point, there must be at least a single bar, but not more than two bars, that form a higher low and a higher high than the preceding bar. It is possible for both the number 2 and number 3 points to occur on the same bar.

source : candlestick

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Ditulis oleh William Perkasa pada tanggal Oct 11, 2013