3 Reasons why it's so important for you to understand market price swings

[Godson1]

If you want to be really good price action trader, you have to understand this concept of how price moves in swings. this is especially true if your style of trading is trend trading or swing trading.
because if you don't understand how price moves in swings, this is what you are going to end up doing;
1. You will execute trades at the very wrong spot. For example , in a downtrend , you will see when the market is just doing an upswing not good
2. Which means you will get stopped out or you need to put in a large stop loss. Large stop loss does not necessarily mean large risk if you do position sizing base on the stop loss distance. But if you don't then that's a large risk you are taking.
3. If you have a large stop loss, then you have got to wait a while before the market makes downswing before you to start seeing profits on your trade.

 

[Setho]

One of the basic ways of understanding financial markets is that they are usually two cycles. There is usually a bullish cycle where the price of an asset is usually going very high and there is usually the bearish cycle where the prices is usually going down. It is very important that whenever we are in a particular cycle you should be able to put in measures to ensure that you can be able to determine when it is going to flip for example if we are having a bearish cycle the swing is when money starts flowing in and then it becomes bullish.

 

[Kingsley]

There I no way any can trade and be a good business man or woman both online and offline, both with forex trading and crypto currency trading without having a very good understanding of how the market prices of goods and services changes. This is one major area a wise business person always explore to his or her own advantage. That is where one can make a super normal profit either offline or online. I will give a scenario of what happened to me somethings ago, it been like 3years ago. I have always been on online person. So I decided to visit a friend who stays far up j n the northern part of my country. It was about a 24hours journey, so on getting there I meet him so well and we had some conversation on some type of online business. So as we discussing I saw a bag of rice in his house than I enquired from him how much they sell around there and I realise there was about N10,000 difference from is been sold from where I reside. So I bought as much as I could and I seized the opportunity to make alot of money from that trip.

 

[btaliat]

Market force, especially in a capitalist market, determines the price of most goods. This is the best reason why a business owner must understand the market and to know the changes that may occur along side running the business. This can be done using different stuffs.

There are some people that always run survey about the market to know the latest about what the price is, this will help in fixing price for the goods and services.

Invariably, this will not let the person charges below or above the general price of the market.

 

[FinTrader]

2. Which means you will get stopped out or you need to put in a large stop loss. Large stop loss does not necessarily mean large risk if you do position sizing base on the stop loss distance. But if you don't then that's a large risk you are taking.
3. If you have a large stop loss, then you have got to wait a while before the market makes downswing before you to start seeing profits on your trade.

When trading, it is not the size of the stop loss (whether it will be large or small), but the correctness of its setting. That is, we must have a trading strategy that shows where to set the stop loss so that it is most likely not to be activated. And only based on the size of this SL, calculate the lot size in the transaction.

 

[moonchild]

Understanding price action is paramount to being profitable if you can not understand simple price action it is very difficult to make any money in the market, because if you're a day trader the only way you track the market is to use technicals, there isn't much happening in fundamentals unless a volatile news is coming.

The good things there are a lot of ways d you can learn about it, I think the first one is babypips.com this will help you build your skill set and make you a good trader, another resource is YouTube but it is important to stick to one trader