Price action: trading without indicators
What you learn in 3 minutesThis lesson shows how to read a chart from its own structure, using highs, lows, ranges and breaks, instead of waiting for a calculated line to tell you what to do. The cost angle matters here: every extra indicator, alert or paid signal is money leaving your account, while price structure costs nothing to read. By the end you will know how to mark a range on EUR/USD around 1.0850 and see a break for yourself.
One entry found from structure on EUR/USD at 1.0850
| Step | Amount | Note |
|---|---|---|
| Range high | 1.0860 | the highest point of the sideways range on the chart |
| Range low | 1.0840 | the lowest point of the same range |
| Range height in pips | 20 pips | 1.0860 minus 1.0840 equals 0.0020, and 0.0020 divided by 0.0001 is 20 pips |
| Break level | 1.0860 | a candle closes above the range high |
| Entry | 1.0861 | the next candle opens just above the broken high |
| Position size | 0.10 standard lots | one tenth of a standard lot |
| Value of one pip at this size | ₦1,530 | one pip on one standard lot is 10 units of the quote currency, so 0.10 lots is 1 unit; at an assumed rate of ₦1,530 to one unit, that is ₦1,530 per pip |
| Stop loss | 1.0849 | 12 pips below the entry, back inside the old range |
| Risk on the trade | ₦18,360 | 12 pips multiplied by ₦1,530 per pip |
| Target | 1.0885 | 24 pips above the entry, twice the distance risked |
| Reward if the target is reached | ₦36,720 | 24 pips multiplied by ₦1,530 per pip |
Your broker may round the pip value, charge a spread on entry and exit, and apply swap if the position is held overnight. The naira conversion rate varies between brokers and changes during the day, so the figures above will differ in your account.
The mistake people make here
The common mistake is to enter as soon as price touches the range high, before any candle has closed above it. A touch is not a break, and price often turns back inside the range, which means the stop is hit for no reason. Wait for the close, then enter on the next candle, as in the example. Also check that the distance to your stop is small enough that the naira risk fits your plan before you click buy or sell.Check yourself
A range on EUR/USD runs from 1.0820 to 1.0850. How many pips tall is it?
1.0850 minus 1.0820 equals 0.0030. Divide by 0.0001, which gives 30 pips.
You trade 0.20 standard lots and one pip is worth ₦1,530 per 0.10 lots. What is one pip worth at your size?
0.20 lots is twice 0.10 lots, so one pip is 2 multiplied by ₦1,530, which is ₦3,060.
Using the same ₦3,060 per pip, what would a 15 pip stop loss cost?
15 pips multiplied by ₦3,060 per pip equals ₦45,900.