What exactly is price action trading?

      Price action trading is the art and skill of making all of your trading decisions off of a stripped down or “naked” price chart. This means no lagging indicators outside of maybe a couple moving averages to help identify dynamic support and resistance areas. All financial markets generate data about the movement of a security over varying periods of time in the form of  Price charts reflect the beliefs of all participants trading the given market during the specified period of time.

      All economic data that leads to price movement within a market is first turned into a belief in the human mind about how this data will affect the market and this belief is then turned into an action from a trader which reflects itself via price action on a price chart. In this way price action trading reflects all variables of any market for any given period of time. This is also the reason why using lagging price indictors like stochastics, MACD, RSI, and others is just a flat waste of time. Price movement provides all the signals you will ever need to develop a profitable and high-probability trading system. These signals collectively are called price action setups and they provide a way to make sense of market movement and predict its future movement with a high enough degree of accuracy to consistently profit over time.