Super 3 in Price Action

 

When we say "Price Action", a type of analysis that includes many candlestick patterns comes to mind. When we look at these candlestick formations, we see that these candlestick formations are essentially derivatives of 3 main candlestick formations. If we are going to talk about these 3 main candlestick formations, they are:

1) Coil

2) Pin Bars

3) Engulfs

Here, first of all, to talk about the concept of coil, coil candle alignment is when the price enters a horizontal area after a bullish or bearish movement, as in the picture above, and makes a coil appearance in a combination of red and green candles. In this process, the price moves in the narrow space and accumulates. In this horizontal area, there is a tight price bargain between buyers and sellers. We can compare this to arm wrestling between buyers and sellers.

These areas where the coil candles are arranged are called sup-dem (supply and demand) regions. Another name for this is the supply-demand zone. These areas are support-resistance zones.

If we talk about pin bar candles; Pin bar candles are divided into pin bar candles that in favor of the buyers and in favor of the sellers. In the pin bars that in favor of the buyers, the needles of the candles are on the underside of their bodies and they are long. These candles can be a signal that buyers are more dominant and stronger than sellers.

The candles in favor of the sellers, as in the image above, the needles of the pin bar candles are on the upper side of their bodies and their length is long. These candles can be a signal that the sellers are more dominant and stronger than the buyers.

Engulf candles, on the other hand, are divided into two as bullish engulf (in favor of buyers) and bearish engulf (in favor of sellers). Engulf is one of the 3 main building blocks of price action analysis, such as candles, pin bars and coils. There is an equivalence relationship between engulf candles and pin bar candles. So much, "Every pin bar is also an engulf candle!" To prove this, when you see any pin bar in any timeframe; If you open a lower time frame window, you will see an engulf candle formation in the same time zone.