The most important indicator and one that is often ignored by new traders is price action. Price action is the analysis of price over time and determines the market sentiment whether the market is bullish or bearish. This is turn can help you decide who is in control buyers or sellers and therefore an informed decision can be made as to how and where to place the trade.

The following chart shows the price and no other indicator.


This chart shows the price action of the currency pair GBP/USD (UK pound against the US dollar) on the hourly time frame. Even to the untrained eye it is possible to see that the price action is on an upward trend. That is not to say that every candlestick bar is forming higher highs and higher lows, but it can be seen that the price on 10th April is higher than the beginning on the 7th April.