VIDEO: Live Price Action Trade Analysis on S&P 500 Index
Want To Trade The S&P 500 Index ? – Try Our Preferred Trading Platform Here
Please kindly leave a comment below – I would love to hear your thoughts :)
Hi Traders, it’s Nial Fuller here from learntotradethemarket.com and welcome to another trade setups video. Today, I’ll be talking about the price action on the S&P500 daily chart, that’s the U.S. stock market index. I’ve spotted what I think is a good trading opportunity to go long and I’m going to go over the analysis behind the trade setup just to help you guys get a little more of an understanding of how I do things and how I come up with my trading decisions.
I only use price action analysis, that is a naked price chart, a clean chart with a white background and black & white bars / candlesticks and horizontal levels. I don’t use any indicators or anything ‘fancy’. Now, let’s get into the trade setup…
First thing to note on this chart is that over the last year we’ve really had a sideways pattern, it was only until August of this year that we decided to have a break down out of this long-term consolidation. Price broke down all the way back to this long-term support from October of 2014, almost tested it exactly and then rallied all the way back up into this resistance area. You can see, it was support here, on numerous occasions and then on the bounce we held there and it acted as resistance.
Obviously, with basic technical analysis we know that previous support becomes new resistance. So, the market was holding around that 2,000 level and then we sold-off again. But, we didn’t end up testing that recent low or break through it, instead, the bulls came back in and pushed the market straight up back through that resistance, and we are now in a new leg higher. So, the bias as the way I see it, is to the upside and we want to be trading longs, buying the market.
Now, there isn’t a lot of price action evidence to get me into the market now, but what we are doing here is analyzing the overall picture and then we are going to anticipate the next trade.
We can see here the market is edging up against that 2060 level and that’s a level we had identified previously, the line is still on the chart after we zoomed in. When we zoom out we can place the levels and when we zoom in those levels are still relevant.
There’s also another level at 2,011, you can see the market found resistance there and then retraced and then moved back up to that area, had a little pause and then broke through it and then price held it again on a downward retrace to it. So, this area here at 2,0111 is also very significant in the short-term. So, the way I see it is if the market can hold above 2,011, we are poised for more upside.
Now, what I’m going to do is anticipate a trade – however, we don’t have a signal that I would put money behind yet and we aren’t really at a level where we can define our risk correctly. So, what I will do is wait patiently for the market to rotate back down toward that 2,011 level.
However, we might only get a pull back to that 2030 level, which is also a very key level. I’ll be waiting for evidence to get me long via price action signal and that might come n the way of a pin bar, fakey an inside bar or false break. If we see any of those signals in between 2011 – 2034, I’ll be looking to get set long and riding the market as it breaks to fresh highs. Now, that might take up to two weeks to happen, we might actually pop up first and then come back down. But, the idea is that we have identified that the market is generally trending up and we will wait for a pull back and we should eventually see the market continue in the same direction.
Now, just a quick word on how to place a stop loss – I think the logical stop placement on this would be below this swing here and better yet, below 1980 which is well below this swing low there. So, if we were to wait for the market to pull back and get a confirmation signal, we could wait to enter in this area here and have our stop below here and target the recent thighs around 2100, in this region here. This would represent a 3 to 1 risk reward.
As the price action unfolds from here we will update members in the daily trade setups video. Until then, take care and good trading.
65 Comments Leave a Comment
Simplicity is the key
Another great video. Love your educational approach, it just works. I recommend everyone joins LTTTM, I did so recently and I am really enjoying it alot.
In the same video, understand that you want to wait for the pull back for a good risk reward ratio but what I see a fakey exactly at the current price area. A mother candle, inside bar and the next candle wick which broke the mother candle. Dont you think the price may shoot up straight up?
I really enjoy this video it is specific to the point and mostly important is the clear indication of the level of resistance.
How to trace when you look back to the left and that gives you a clear indication of where the market is going based on the previous high & lows.
To be a newbie is hard in trading and you need to get as much information as possible to survive.
Thank you again for such an amazing work.
I like the clarity of your explanations
Thanks a lot…
Can I use this strategy in hour time frame?
Thanx a lot
Thank you for such a fast reply. Ill look into it.
Ive been studying Gold since the Spring of 2017 Seeing your videos makes me realise why Ive been feeding the markets. I should have found you sooner! Thank you for taking the time to help beginners like me. As a Binary Trader, Im using “High Low” would you recommend a different platform? Thank you
EXCELLENT VIDEO , SIR WHICH BOOKS WILL YOU SUGGEST FOR LEARNING PRICE ACTION
Great video. Thank you
I am really impressed on how you give details on how to Trade. I am someone who just discover the Trading Market and would like to know more and learn how to Trade special how to consider the pips and diagrams.
I would like to know how to enter a Trade and how to pull out.
Thank you Nial
I am a beginner and my problem is how do you draw high probability support and resistance levels.
i am a beginner in forex trading and i need your help on how to use the price action strategy. i also want to become a member of your team. thank you
i am still a learner and i want to perfect in forex trading using the price action strategy. i need your help on how to become a member of your team .
Hi Nial, thanks for the video. My thought is what is the tale behind market support and resistance? are they Seller and Buyer’s maximum money to be committed in that level.
Hello Nail, all the videos that you posted in this blog are helpfull. I would like to thank you so much. Really you do a great work here.
Please I want to learn and be an expert in forex trade if I can get any help.thanks
great advice thank you
Thanks for presenting price action in a very simple way. I am still learning price action
Thank you sir for the weekly signals is what I’m using tto trade and is help me,thank once again may God bless you.
I did not understand the graphs first but after I have seen the videos I now have clear picture thanks
Nail , you are always Wonderful .
PAtience is profitable
sir plz tell me .. are u also going to give us a signals in your membership ?
We post up a daily trade setups video.
Nial, How is it in your video that you do not consider the mother bar, inside bar, and pinbar fakey to be a PAS for entry but are waiting for a pullback?
My initial view worked out perfectly. The market pulled back and then retraced higher strongly. Just because a price action setup forms doesn’t mean we have to trade it, sometimes experience tells us to remain patient for a more ideal setup (and in this example patience paid off).
Thanks Nial. I’m still working on being patient :-)
I am retreshing an interest and study i began and completed earlier in the year and i am very pleased to have understood and agreed with all your views.thanks for the oportunity to see,cheers Peta
Your commnts & relevancy regarding price movements of forex currency pairs are undoubtedly beyond the shadow of doubts & excellently remarkable.
Great example of how to keep the things simple under a logic frame work…. looking forward to seeing more videos like this … super like … greetings from Colombia
Thanks Nail, you make me a man of hope in my life.
Well done, Nial.
Thank you, Nial. you are a guru, and your video is great!.
Very educative as usual. Thanks Sir Nial
hi,Nial from Viet Nam
you and your Strategies really changed mylife, sure !!!
thank you very very much !!!!
Tank you so much for the analysis. It is good to know I am on same page as you to go long on this trade. Do you analyse the weekly charts or monthly charts for SPY?
Great article, Nial|!
Thank’s from Brazil!
Nice video , would you consider placing an order without waiting for a for a confirmation bar
. Thank you, Nial. we need more, like this!
I thought how brave you are to publish a video like this on the day of an interest decision of the FED. You know how volatile markets can be at such a day – and after. I know you prefer “pure price action” but I still like to have more of a general picture and that tells me it might become more and more difficult for stock markets to rise. Looking at the chart I would never had the idea that it would go back to something like 2011-2030 and then rise again. Thanks for that point of view, for me that’s very interesting! So I’m keen to watch the charts for the coming weeks from the sidelines.
Markus, I prefer not to over-think. If a market is trending higher I am looking to buy, and if it’s trending lower I’m looking to sell. People often get caught up in a game of thinking themselves out of perfectly good trades by thinking it’s “too high” or “too low”, then they miss all the big moves and finally when the market has proven them wrong enough times, they decide to jump in right before the trend actually does reverse finally.
Don’t over-think or over-analyze. Learn to trade the price action and follow what it is telling you. News and all of that is factored in. You can see that today clearly…the S&P500 continued higher despite the US interest rate decision and anything else that happened.
today´s market is getting higher, no pull-back, no good for swing traders.
Very consistent on your strategy….
Thanks Nial – one of the most useful videos you have published. Would be great to see similar videos on other markets as well.
We have to wait 2 weeks, that’s probably the most important aspect of the video: patience. The analysis tells you where to look for the trade. So if you need to wait 2 weeks, be patience. The price will give you an oportunity and you will do money, don’t worry. That’s important. Trading is not a work in which you have to make money every day o put X positions per week. Sitting back and doing nothing is part of trading, and probably the 80% of the trading work is do nothing, am I right?
Marcon you are 100% correct, good trading is sitting on the sidelines waiting. Be patient and wait for the trades to come to you.
Thanks Nial, you explain this so it can be understood . It would be helpful if you could show more live videos like this as makes sense how one has to be patient .
Nice video Nial. Well done! Muchas gracias
As always, you are sincere, and try to be logical. Now: 1) it has already re-traced 2075-1860=215 pts (how many pips equivalent is that?), a very high value; 2) It has 13 up-trending bars, incl 4 very strong pushes; 3) High is 2123 – if you believe in those lines (I prefer regions), you have only 48 points left; 4) this is longer-term chart.
Question: If you believe in cyclic nature of markets, Don’t all these indicate market “nearing” exhaustion? Probability for even moderate wins are very low, which says .. — Look for other markets till you can SELL this?
ps. Sometimes, simplicity is inadequate. Complex (not complicated) entities ARE needed – As a scientist, I have observed that reality umpteen times.
Interesting points you have made. If you listen to my comments I am talking about waiting for a pull back to support and more evidence to confirm a long entry, the entry would be closer to 2011-2034, and thus it is 100 + points back to the previous high. I am looking at the broader chart formation here, the market has really hammered in a bottom in the last few weeks and price has forced its way back up above some major resistance levels (1975 and 2011 are significant levels). Just because the market has gone up 150 to 200 points does not mean it can’t go up another 150 or 200+ points. As I have said in recent articles, the market often goes much further than most imagine, and most sit by and watch the big moves instead of trading them.
Thank you. This is great stuff. Especially where you put your stops.
Love the video Nial. Always good to see you break down the charts and show us how it should be down. Cheers.
does the last three candle is not consider a Fakey set up?
Dan it is, but the bars in this pattern are very small, and the pattern has occured right at the top of this leg higher, for me it’s not in the right position to be able to manage risk correctly. In the video I have said I want to wait for a pull back or more evidence to get long. You are in theory correct, the pattern is a fakey and the market could rally higher on the back of this price pattern.
Hello Nial! Thank you very much for this video, really explanatory and helpful to make a trade on the following weeks.
I had already thought about this entry but not yet decided about the area for the SL. Thank you :))
I am really so proud to jion in your comunity
i like your articls and your vedeos as well.
have a nice day
It is always good to have good analysis to look at as it reaffirms the importance of sticking to the trading plan and applying patience and discipline.
Thank you, Nial ! It looks so easy and clear when you explain …
Great video!! Really helps to see your thought process.