Best Trading Strategy Without Indicators In Forex

This trading strategy means you’re trading without indicators. It is also called a naked forex trading or price action trading.

By Guy Avtalyon

Let’s say you’re a beginner in Forex trading and still don’t understand indicators quite well so you would like to know what is the best trading strategy without indicators. One of the best ways is to trade using a price action trading strategy. Actually, I’m gonna suggest you some.

Forex trading is complicated for some people because so many technical indicators are involved in trading. One of the simplest forex trading strategies is the forex portfolio price action. If you use this really the best trading strategy without indicators. And you’ll see, you’ll find some of the trades by using this strategy. 

What is price action trading?

Price action trading is the best trading strategy without indicators and I’ll show you how simple and favorable it is. The point is to find out how the price will behave when you test it in support and resistance zones. This strategy will help you to identify where the price movements form a swing high or swing low. The simplicity lies in the fact that you don’t need moving averages or some lagging indicator to identify it. These indicators can be confusing but with a price action trading strategy, you’ll have a clear chart. Why am I so sure this is the best trading strategy without indicators? Because thanks to it many forex traders are very profitable. No indicators are involved, you don’t need to know them, no need to understand them or recognize. 

So, let’s be more concrete. Here is how to use price action strategy.

The best trading strategy without indicators

As I said no indicators involved but we’ll discuss how they can be dangerous if you use them in the price action strategy.

Now, you have to pay attention to price action setups. If you notice that there is no price action, it is a so-called dead zone. Who would like to trade there? Literally no one. The dead zone is as the name indicates, exactly that – dead. Nothing happens there. The price doesn’t make any move. The sellers and buyers are like on the teeter. The dead zone is a standby zone, nothing happens and everyone is expecting what is going to happen. No one wants to trade because it is impossible to enter or exit the trade in the dead zone and win. The reason is simple, no one wants to do anything. So, never enter the trade in a dead zone.

Forex trading is a game of nerves

So when there is no price action you’ll have to wait until something starts to happen. 

The other price action setup is the red zone. That is where all price actions are happening. That is exactly the point where you’ll have to make almost all your trading decisions. This is a zone with a lot of price movements. You have to be focused on such an occasion. Even with a move of 20 pips only, you’ll have a winning trade. With 100 pips you can potentially make a lot of money.

Your next goal is to reach the end zone. As I said, the red zone is where the price actions happen, but you’ll have to move closer to the end zone if you want to maximize your profits. Only then the price action strategy will give you its best. So how to find this zone? Simple! When the market is 10 to 20 pips wide that means there is enough space for changes and adjustments. This spread of 10 pips is exactly what you need for the best trading strategy without indicators. The price action strategy needs changes to provide you a successful result and exit in profit.

Price action strategy without indicators in Forex

All you have are support and resistance and volume. Volume isn’t an indicator because it is a statistic. 

So, this strategy is only about two things. First, you have to identify what is the price action in support or resistance zones. If you notice the market comes into high resistance, the traders now can do several things. The first is that they could do nothing because the price enters the resistance level. Second, traders could start to sell. If they didn’t have an open position, they could start to sell short. Also, traders could buy. 

But what we need here is to see a large volume on a breakout. We need a lot of buyers to move the price to break the resistance. So, what we really need is a lot of buyers, a lot of orders, a lot of trades. 

But pay attention! This can be a tricky part. What if a new resistance occurs? It is possible to happen and here is what you’ll need to do if you want to profit. If you notice a new resistance it is likely an exhaustion pattern. As I mentioned it is not the right time to buy. You’ll need more space between the point you entered the trade and the point where you exit. Some traders would trade the new breakout. But it is the wrong decision. You should wait until the price breaks the new resistance, just be patient. But what if the price does not break out above it?

You’ll have to wait until resistance becomes a support to buy low and sell high.

Drawbacks with forex trading without indicators

The price action strategy is also called a naked forex trading. The main problem here is that you’ll need a lot of developed skills to use this strategy. This means you’ll have to understand market psychology,  why the market moves, and you’ll need to recognize how the market moves, and how it will move. Also, sometimes you’ll need to rely on intuition and it isn’t the best way. At least, it isn’t a safe way. But it can be a very profitable strategy once you develop your skills. Maybe you should start with a demo account, that is something I always recommend to beginners.

Anyway, you should look at price action first and then at indicators. If you need, use the indicators to confirm the decision to make the trade. This strategy will save you time, you have only two factors to estimate. Your trades will be less stressful and simpler. The final consequence is that you’ll be able to trade more precisely. In any case, never just jump into the trade, you’ll need to know when to enter and when to exit your trades. Don’t do anything before you determine these points.