A Trading Quiz on Price Action Trading

trading quiz on price action trading

In my Price Action Course, I am often sharing my personal live trades, using them as a learning experience for the private members.

My goal is to help them learn price action, so one of the methods I will employ to help them with this is create trading quizzes.

Today I want to share one of those quizzes on an actual live trade setup I took.

Before taking the trade, I was looking at 3 different charts, so I took screenshots of each chart I was considering trading.

I will often do this when reviewing my trades at the end of the week, or examining the price action to increase my pattern recognition skills.

If you want to learn price action and how to trade it, that learning process must come from many sources – not just trading or watching videos.

The Trading Quiz

Below are three charts, all of which I was considering trading last week. Each one presented opportunities, both trading with the trend, some counter-trend, while others both long and short.

For this trading quiz, examine each chart in detail. Look at the overall price action context and structure. Some are offering with trend setups, some are offering counter-trend setups, and some are offering both (or none at all).

Your job is to decide which ones to trade, where, and how.

Hence your answers are the three possibilities:

a) Trade With Trend
b) Trade Counter Trend
c) No Trade

For each trade, fill in your answer (using a, b or c for each chart), what you see in the price action, and why you will take this trade. You can choose A and B as appropriate answers.

This is a great opportunity to see how well you understand price action, how well you can spot with trend or counter-trend setups, & what opportunities you can find in the charts.

There will be no prices marked, nor will I tell you what instruments they are (so you cannot cheat :-). I did however mark some key support and resistance levels I am looking at to give you some small hints.
But by and large, this is just pure price action trading and analysis.

Here we go.

Price Action Chart #1

price action chart #1

Price Action Chart #2

price action chart #2

Price Action Chart #3

price action chart #3

Your Quiz:

In the comments section below, fill out your answers. You can list the name of the trade (Price Action Chart #1, 2, or 3). Then provide your answer (a, b or c). And lastly, explain the reasons for your trade setups and why.

Then I will respond with a follow up article what live trade setups I took, sharing my exact entry / exit points, and what I was reading in the price action.

Now try to answer each one using your current trading skill set. The winner with the best answer (most detailed, complete and closest to mine) will get a $50 discount on any one of my forex trading education courses. I will announce the winner with the next article.

Good luck and I look forward to your answers.

Buddhist, Trader and Philanthropist

I'm Chris Capre, Founder of 2ndSkiesForex. I help traders of all levels change the way they think, trade and perform. As a professional trader, I specialize in trading price action. As a teacher, my passion lies in showing you how to re-wire your brain for successful trading. Want to improve your edge right now? Visit my Price Action Course page.

Related Article

  • Hakan

    1 & 2 – Retracements towards support and moving average zones, might be good opportunuties for opening LONG position ‘To Trade With Trend’.

    3- Unless get closer to Resistance Area ‘No Trend’, if it is done open SHORT position to ‘Trade Counter Trend’ and retracements to the support area might be good opportunuties to ‘Trade With Trend’

    kind regards,

    • Chris Capre

      Hello Hakan,

      Very nice. Solid and clear answers. You are the first to answer – so for being the brave one, contact me via the Contact Page, and I’ll give you $50 off any course.

      BTW – what support levels would you buy from on trades 1 & 2?

      Let me know and congrats on being the first to answer!

      Kind Regards,
      Chris Capre

  • Richard Cruz

    Price Action Chart #1:
    Ans: a) Trade With Trend
    Will wait for the price action signal to get long on the pullback/retracement on the previous resistance now support level (role reversal)

    Price Action Chart #2
    Ans: a) Trade With Trend
    Will also wait for price actiob signal to take long position on its pullback to previous resistance now support (role reversal) and confluence to MA.

    Price Action Chart #3
    Ans:
    Will wait for price action signal on resistance level to counter with trend (short).

    Or wait for the pullback on previous support to trade with trend.

    • Chris Capre

      Hello Richard,

      Thanks for participating, and some solid answers here. I do like how you opted to take a trade on each one, so well done.

      Kind Regards,
      Chris Capre

  • luis

    Hi Chris, and this is not for $50 usd off.

    1).- Answer a, trade with trend, order flow seems bullish despite a couple of upper wicks, conservative buying on breakout or seeing a big rejection on support.

    2).- Answer c, No TRADE, I see many wicks in upper side and red bars, not sure if trend will resume, need to see confirmation on either side of the market.

    3).- Answer b, Trade counter Trend, Big rejection on Resistance (many times), it may tell us bulls not defending till lower level to buy cheap, and for now bears in control, selling on crossing 20 EMA, stop loss above the wick of last blue candle and take profit on first level and second take profit 10 pips before support so RR should be reasonable.

    Any feedback would be appreciated
    Regards

    • Chris Capre

      Some pretty solid answers there Luis.

      You are still in contention for the $50 discount.

      Ironically, with not many people writing in as of yet, the odds are favorable for you :-)

      Kind Regards,
      Chris Capre

  • Andrew Earl Daley

    Chart 1 – a) I would wait for price to pullback to the role reversal support line at the 20EMA and look for price action to go long with the up trend.

    Chart 2 – a) same decision as with Chart 1 and for the same reason.

    Chart 3 – c) I personally dont take trades when price appears to be in the middle of nowhere. I would wait to see how price reacts to either the resistance or the support line.

  • Intercept

    Chart #1 – b) trade counter trend
    Large range + failed breakout as breakout candle has been rejected. I short on the candle closing below the resistance, targeting the support.

    Chart #2 – a) trade with trend
    Bullish trend + tight consolidation + breakout (buyers are in control from the beginning) , I wait the pullback toward breakout line and go long with price action signal above EMA20.

    Chart #3 – c) no trade
    Buyers are strong but sellers have successfully defend the level. The big wick indicate the 2 sides are still there.

    Kind regards,

  • Edwin

    Chart #1 and #2 , Trade With Trend
    I would wait for the candle to touch off the support level,and open for Long

    Chart #3 No Trade
    Unless the price move out of the ranging/consolidation area(either broke the support or the resistance level),else it would be a no trade for me.

    Thank you

  • danilo rantucci

    CHART #1:
    Price action Sturcture: Pre-Breakout confirmed after the precedent pin on the lower side of the channel. No trades untill the re-test of the break-out and his confirmation also by the ema acting as support too.
    CHART #2:
    Price structure: very similar but more probabilites of succesfull breakout due to the more tight channel, better definte limit of the channel, and lower/more controled volatility. No trade until the re-test and confirmation of breakout.
    CHART#2:
    Price action structure is a pullback in a first end of up trend. Trade counter trend and possible an entry at market at also 50% retracemetn of the previous pin confirming the resistance.

    ciaoo

  • Tomson

    Chart #1, A Long position
    Breakout that seems to be real, higher and higher lows after the breakout, the small wicks on the top of them aren’t bothering me here.

    Chart #2, C No trade
    Breakout with no follow through, price is drifiting back again.
    Perhaps a long if I get a Pinbar from the top SR here.

    Chart #3, B CT
    Strong rejection with two red candles first, then a bearish pinbar with long tail, short this to the SR below or deeper perhaps.
    Kind Regards

  • ATTILA KUKLI

    Price Action Chart #1 – a) Trade With Trend
    In this case I would wait for price retracement, until it reaches the support level, and would like to see a bullish rejection candle off that support level, and would place a buy limit order at approximately 50% of that bullish rejection candle to gain more pips.

    Price Action Chart #2 – a) Trade With Trend
    I would go about this chart the same way as described above. However, if it was a daily or a 4 hour chart I think this chart would allow us to initiate a counter trend trade before we would Trade with Trend. I would place a sell order just 1 pip under the low of the two red candles. The take profit could be the support level drawn by you.

    Price Action Chart #3 – b) Trade Counter Trend
    In this case I would place a sell stop order below the previous swing low. If the price was hit I would be in a trade aiming at the support level as my take profit target.

  • Hakan

    Hello Chris,
    on the 1st pic the lows are getting high, therefore buying on retracement to the first support might be safe. As additional, there is a pennant pattern and the prices might not get close to the support level if it is blow.

    On the contrary, on 2nd pic, highs and lows are getting lower. Therefore first suppot area might not be safe but in my opinion I might try to buy as low amount and close stop loss level. Because there is a wedge pattern which means escalating possibility.

    kind regards,

    • Chris Capre

      Hello Hakan,

      Didn’t you post already? Trying to get two entries :-))

      Just kidding, I appreciate you sharing some new details.

      Kind Regards,
      Chris Capre

  • Falco

    Hello Chris,

    Below are my answers.

    Price Action Chart 1:
    Trade with Trend
    Overall trend is up.
    Price made an implusive move upwards, breaking through prior highs by a significant amount (also moving far above the 20EMA). A corrective move is currently forming, as the bars are smaller and of mixed colors. I am waiting to catch the next upward impulsive move.
    Would wait for price to retrace back to the recent resistance line.
    Get long when price shows signs of former resistance turning to support.
    Even better if price also finds support on the 20EMA because the 20EMA can serve as a dynamic support/resistance line too. Place stop few pips below this support level or 20 EMA, depending on the situation. Exit at the current high.

    Price Chart 2:
    Same as Price Chart 1.

    Price Chart 3:
    Trade Counter Trend
    Looking the the most recent half of the chart, the trend is upwards with 2 legs of impulsive moves. Then a pin bar forms at the resistance line. Price moves down, then tested the resistance again. Bearish engulfing bar formed at the resistance line before price moved further down. Price made a final attempt at the resistance line but it failed and got further rejected than before (impulsive move down) and even went below the 20EMA (dynamic support). Then in one single bar, it spike up to the resistance line again, right to the pip, before diving below the 20EMA.
    Currently, price is facing resistance at the 20EMA(a small pin bar + bearish engulfing bar). Looking to go short at the next candle. Place stop few pips above resistance line. Exit at the lower line marked on the chart.

    Kind Regards,
    Falco

  • Dave

    Price action chart 1
    price was in a volatile up trend price had broken up with large bull bar bear stops were tripped roll reversal set up

    Price action chart 2
    price was in a non volatile up trend followed by consolidation bears had little push back accumulation of buyers and seller great breakout setup

    Price action chart 3

    Looks like price was correcting in volatile market made a double bottom price was carried by 20ema bears were getting weaker they had 1 last push had no follow through bull taking control with large bull bar followed by impulsive move. no trend. tools breakout

  • Chris N

    Price Action Chart #1
    a) Trade With Trend

    Following the strong breakout of the resistance area of prior swing highs, probably due to standing orders being triggered and fueling order-flow to the upside, price has stalled somewhat with upper tails on candles. I expect a retracement due to breakout traders taking profits/counter-trend traders scalping and will look for the pullback to occur at prior resistance becoming new support. With the market in an uptrend, I will only look for trades to the upside.

    Price Action Chart #2
    a) Trade With Trend

    Similar to the first trade, the market has broken out of consolidation stongly to the upside and has begun to stall. Looking for old resistance to become new support, I’ll watch price as it pulls back to this level for a signal to go long against weakness. Though a counter-trend trade may work here, I prefer to wait for price action to unfold.

    Price Action Chart #3
    c) No Trade

    Price is stuck between 2 S/R levels without a clear bias. MA is flat. Though price broke out strongly to the upside earlier, the recent bearish strength, the break of the previous swing low, and overlapping bars with candle wicks make me want to wait and see how price reacts as it tests the S/R edges and look for a setup as a range trade.

  • Larry

    Hi Chris,

    I just read your trading quiz today and I may have missed the $50 discount =(

    Anyway, here are my answers:

    1. Price Action Chart 1: a
    This is a Breakout Pullback Setup. Buyers broke the resistance level and this level may become a support level if the price pulls back. The breakout leg is very impulsive and was followed by a corrective leg. Although there was a relatively long wick to the upside, which may indicate that sellers came in or profit taking, we didn’t see any follow up selling, instead corrective leg followed. Furthermore, Buyers will do there best to maintain the prices above the 20 EMA. We may initiate Buy limit order at the 20 EMA and the S/R level.

    2. Price Action Chart 2: a
    This is also a classic breakout pullback setup. My analysis is same as Price Action chart 1.

    3. Price Action Chart 3: c
    I cant find any valid trade setup here since it seems that we are in the middle of a trading range. I’d rather wait for the market to retrace deeper towards the support and initiate a long position. Another option would wait for a breakout of the resistance and go long on pullback.

  • Nathan

    Price Action Chart #1) Price is relatively far from 20 EMA, I would wait for retracement back to prior resistance (now support?) to enter long with the trend. 1) a)

    Price Action Chart #2) Although similar to #1) the 20 EMA is catching up much faster and the pennant type formation is much more bullish. I would not wait for a pullback to the prior resistance (there probably won’t be one). I would trade with the trend on a break of the pennant. 2) a)

    Price Action Chart #3) Personally I wouldn’t take a trade; however, if I did it would be countertrend for the following reasons:

    – Three rejections off of resistance
    – Rejections are progressively stronger
    – Last touch (pin bar) of resistance was immediately rejected
    – Price barely staying above 20 EMA and well below resistance area

    3) b)

    Nathan

    P.S. I am not concerned about the rebate but would love feedback from Chris

    • Chris Capre

      Hola Nathan,

      Ha – getting in just in time. I’m literally completing the follow up article right now.

      Will comment shortly.

      Kind Regards,
      Chris Capre

  • Sanjay

    1&2 trade with the trend in all the charts. wait for pullback -retest setup.
    3- No trade based on provided chart.

    • Chris Capre

      Hello Sanjay,

      Well consider yourself lucky as you are the last person to qualify for the $30 discount.

      Email me for details via the contact page for how to take advantage of this.

      Kind Regards,
      Chris Capre

  • AUREL mARIAN

    Hi Chris,
    Please,I want to know,I can trade directly to Liqiudity Provider?I can bypass Forex Broker???
    Thank you
    Best Regards

    • Chris Capre

      Hello Aurel,

      If you have enough capital, say 5-10M+, yes, you can trade with some liquidity providers avoiding the forex broker.

      Kind Regards,
      Chris Capre

  • Charles Radev

    Q1 – a) Action Long, why – steep MA line going up solid chance of long term price increase
    Q2 – b) Action Short, why – MA weaker slope, price action will fall back to supprt before it goes bullish again
    Q3 – c) no action , why – expect a ranging sideway price action, no indication from MA

  • Tabb Mayo

    Hi Chris,
    In Price action chart #1, I choose A:
    Bulls were in control, blowing past support-resistance line in major bar, but then got rejected. However price has still drifted higher suggesting they haven’t given up. So I would place a pending buy order just above the two pin bars that succeeded the initial bull move above S/R.

    Price action chart #2, I choose B ( sort of ):
    I have bought this pattern far too often! I would sell this just below where it is now. The only reason I put in “sort of” is it depends on how far it is to that upper S/R line. If it’s just a few pips then it doesn’t seem worth it; if it’s 20, 50, 100 pips then yeah. I believe that S/R line will be the first place price action might find support.

    Price action chart #3, I pick C:
    Previous move brought the price action above upper S/R line but it fell back to a level say about at the 23rd candle before the current one. That level appears to be a resistance level for the time being. When price action broke through the lower S/R level it stalled at level about the close of the first candle above the lower S/R level. That level seems to be the support to current price action. I think that price action will bounce between these two levels until something happens (news release, economic report, big move in another currency, etc ). So wait for a break out.

    Hope I am getting your message.

    Best regards,
    Tabb Mayo

    • Chris Capre

      Hello Tabb,

      I think you got about 30% of it in your explanation. Definitely some details missed, but a few solid ideas for sure.

      Kind Regards,
      Chris Capre

  • Mthokozisi

    1(a).buy, price still ascending.
    2(b).sell,fail to break significant level.
    3. No trade. Price Consolidating.