Questions and Methods for Price Action Analysis

 Winners and Losers in the Market

a. Who is dominating the current swing, bulls or bears?

b. Are they correct?

c. If they‟re wrong:

i. Where is this move likely to stall? Where is the opposite order flow

likely to enter the market?

ii. Where will these traders have positioned their stops?

d. If they‟re right:

i. Where are these traders targeting? Where are they going to take profits

or lighten their position?

e. If they‟re in the right direction, but late:

i. Where is the worst place to be entering late in this move? Where will

the late traders be stopped out?

Trapped Traders

a. Where is the last group of trapped traders?

b. Where are they hoping to get out? How will that affect price?

c. Where will they give up and bail out? How will that affect price?

Expectations - Most Likely Price Movement

a. What do you expect the market to do from here?

i. Why do you expect that?

ii. How would price have to behave prior to that move occurring?

iii. Is price behaving this way?

b. If the most likely scenario does not eventuate, what else could the market do?

i. How would price have to behave prior to that move occurring?

ii. Is price behaving this way?

c. Is there a third possibility for a potential market move?

i. How would price have to behave prior to that move occurring?

ii. Is price behaving this way?

Expectations – Bullish, Bearish, Neutral

a. What would a bullish market do here?

i. How would price have to behave prior to that move occurring?

ii. Is price behaving this way?

b. What would a bearish market do here?

i. How would price have to behave prior to that move occurring?

ii. Is price behaving this way?

c. What would a neutral market do here?

i. How would price have to behave prior to that move occurring?

ii. Is price behaving this way?

Bulls Vs Bears

a. Who is in control – the bulls, the bears, or neither?

b. Why?

c. How dominant are they?

d. What beliefs led to this current market action?

e. Is control changing?

f. What would have to happen to indicate a change of control between the bulls

and bears?

g. What would cause the maximum fear in the current dominant power?

Professionals Vs Novices

a. Where did the professionals enter?

i. Where‟s their stop?

ii. What will happen if price hits their stop?

iii. Where‟s their target?

iv. What will happen if price hits their target?

b. Where did the novices enter?

i. Where‟s their stop?

ii. What will happen if price hits their stop?

iii. Where‟s their target?

iv. What will happen if price hits their target?

c. Where will the professionals enter?

i. What does it mean if price reaches this area?

ii. What does it mean if price doesn‟t reach this area?

iii. Where will they place their stop?

iv. What will happen if price hits their stop?

v. Where will they place their target?

vi. What will happen if price hits their target?

d. Where will the novices enter?

i. What does it mean if price reaches this area?

ii. What does it mean if price doesn‟t reach this area?

iii. Where will they place their stop?

iv. What will happen if price hits their stop?

v. Where will they place their target?

vi. What will happen if price hits their target?

Best vs. Worst

a. Where is the best place to be entering, or adding to a position?

b. Where is the worst place to be entering, or adding to a position?

Market Structure

a. Where did we open today relative to yesterdays close, low and high? What

does this mean?

b. Where are we trading relative to yesterdays close, low and high? What does

this mean?

c. Where are we trading relative to today‟s opening price and the opening price

range? What does this mean?