Price Action Trading Guide: Candlesticks, Support and Resistance, Supply and Demand
By Tejas Wankhede (Tejas Sir), commodity trader and founder of The Millionaires Floor, Nashik. Updated .
Quick answer
Price action trading means making decisions from the price chart itself (candles, levels and structure) instead of relying on many indicators. Core tools are support and resistance, candlestick patterns, supply and demand zones and market structure. Adding volume helps confirm which levels large participants care about.
What is price action trading?
Price action trading is a method of technical analysis where you read raw price movement, such as candle shapes, swing highs and lows, and key levels, to decide entries and exits. It uses few or no indicators. The goal is to understand who is in control, buyers or sellers, and where that could change.
Support and resistance
Support is a price area where buying has stopped a fall before, and resistance is an area where selling has stopped a rise. The more clearly price has reacted at a level, the more traders watch it. When a level breaks with strong volume, old resistance often becomes new support, and the reverse.
Candlestick patterns that matter
Candlestick patterns are useful only at important levels. The most practical ones are the engulfing candle, the pin bar (long wick rejection), the inside bar and the strong-bodied breakout candle. A pattern in the middle of nowhere means little; the same pattern at support or resistance with high volume means much more.
- Bullish or bearish engulfing: a candle whose body fully covers the previous body.
- Pin bar: a long wick showing rejection of a price area.
- Inside bar: a pause candle inside the previous range, often before a breakout.
- High-volume breakout candle: a large body closing beyond a level on above-average volume.
Supply and demand zones and order blocks
A demand zone is the base from which price rallied strongly; a supply zone is the base from which price fell strongly. An order block, a term from smart money concept trading, is the last opposite candle before such a strong move. Traders expect price to react when it returns to these zones.
These ideas overlap. Whether you call it a demand zone or a bullish order block, the logic is the same: strong, fast moves often leave unfilled orders behind, and price frequently reacts when it comes back.
How volume improves price action
Volume shows how much participation is behind a move. A breakout on low volume often fails, while a breakout on clearly higher volume is more likely to continue. Combining price action levels with high-volume candles is the core idea behind the Samrat Strategy taught at The Millionaires Floor.
Frequently asked questions
Is price action better than indicators?
Price action shows information directly, while most indicators are calculated from past price and lag. Many traders use price action first and one simple indicator at most.
What is the most reliable candlestick pattern?
No pattern is reliable on its own. Patterns are most useful at clear support, resistance or supply and demand zones with volume confirmation.
Can price action be used for commodity trading?
Yes. Price action works on all MCX commodity charts on any timeframe.
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Disclaimer: This guide is for education only and is not investment advice. Trading in commodity derivatives involves substantial risk of loss. The Millionaires Floor does not provide tips or guaranteed returns. Read the full risk disclaimer.