Updated on June, 12th, 2015
Master candles do not work anymore
I am sorry to disappoint you, but master candles do not really work anymore. This post was written in early 2010, back then, master candles were awesome to trade…
… What changed?
Well, over the last five years, volatility in Forex has crashed. When volatility was high, break out trading was extremely profitable. If you traded a master candle break, price would easily hit your targets. These days, price tends to stall and reverse before hitting master candle targets. Even with tighter targets, master candles just aren’t profitable.
Check out this chart tracking average daily ranges for AUD/USD.
You can see that average daily ranges have fallen. This means that price is moving much less on average, making master candles too risky to trade.
Other price action strategies
Don’t worry though, I have got you covered. These days, I concentrate on trading highly accurate price action based reversals. You can check out my free price action strategy, for a break down of my trading strategy.
Reversal trading is the most reliable, and most consistent way to trade Forex price action. Check out this trade that I took this week.
Of course, not every trade works out this well. However, this strategy has a high win rate, and has been working consistently since 2007.
How to learn price action
If you want to check out my free strategy in more detail, I often host webinars to share my strategy and answer questions. Here are some of my latest webinars.
- Trading my price action strategy on past data
- How to place support and resistance areas
- My advanced price action strategy explained in three webinars
Hopefully you can adjust to Forex without master candles!