Price Action · Guide · 3 min read
What is price action?
Candles, market structure and levels: the building blocks of reading a chart.
Price action is the study of how price moves on a chart, without relying on many indicators. Traders read candles, structure and levels to understand what buyers and sellers are doing.
The building blocks
- Candlesticks show the open, high, low and close for a period.
- Market structure describes whether price is making higher highs and higher lows (an uptrend), lower highs and lower lows (a downtrend), or moving sideways (a range).
- Support and resistance are levels where price has previously paused or reversed.
How traders use it
Many traders plan a trade by identifying the trend, marking nearby levels, waiting for a candle that confirms their idea, and placing a stop-loss where the idea is proved wrong.
Price action does not predict the future. It helps you define a plan, and the risk, in advance.
This guide is educational and is not investment advice.
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