Encyclopedia Classification
Category: Technical Analysis • Market Psychology • Trading Execution
Discipline: Candlestick Analysis • Market Behavior • Auction Reading
Prerequisites
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Article 194 — Market Structure Analysis: Trends, Breaks of Structure, Reversals, and Multi-Timeframe Frameworks
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Article 187 — Order Flow Analysis: Understanding Market Pressure Through Buyers, Sellers, and Real-Time Execution
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Article 188 — Volume Analysis: Understanding Participation, Conviction, and the Force Behind Price Movement
Related Articles
Candlestick Patterns • Market Structure • Supply and Demand • Liquidity • Order Flow • Wyckoff Method
Definition
Price action trading is the analysis of raw price movement to understand market behavior without relying primarily on lagging indicators.
Price action studies:
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Candles.
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Patterns.
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Momentum.
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Rejections.
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Breakouts.
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Market structure.
The central idea:
Every candle represents a battle between buyers and sellers. The outcome reveals information about market intent.
Beginner Explanation
A candlestick is not just a colored box.
It is a record of a fight.
Every candle answers:
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Who pushed price?
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Who defended?
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Where did rejection occur?
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Who gained control?
Example:
Bitcoin candle:
Opened:
\$100,000
High:
\$105,000
Low:
\$99,000
Closed:
\$104,000
The story:
Buyers pushed higher.
Sellers attempted rejection.
Buyers won.
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