4 PRICE ACTION TRADING STRATEGIES FOR PULLBACK TRADERS
Originally published on https://www.tradingsetupsreview.com
Pullback trading is a fantastic starting point for new traders. It emphasizes the importance of respecting the trend and defining your trade risk. The cornerstone of finding pullback setups involves gauging when a pullback ends. In this list, we’ll explore four trading strategies that use price action analysis to do this.
PULLBACK TRADING STRATEGIES
For any pullback trading strategy, tracking the market bias is critical. Get the trend correct, and you will enjoy much greater success with pullback setups.
If you are confident that the market is trending, why can’t you just enter the market at any point?
It sounds reasonable as the market is on our side in any case.
Yes, you can.
But you will likely need a wide stop-loss to account for potential whipsaws and pullbacks. This will affect your reward-to-risk ratio. Hence, it might not work out profitably for all trading approaches.
On the other hand, the price action methods above can help you to find where a pullback is likely to end. Refining your pullback entry helps you to place a tighter (yet reasonable) stop-loss.
Need more examples of the above pullback strategies? Refer to this list: