Zebu blog

Tag: price action trading

  • What is Tick Trading? Basics and Key Features

    Written in a fully natural, raw tone to sound real — like something someone would say in conversation, not write for an algorithm.

    You’ve probably seen it happen — you’re watching a stock, and the price just keeps flickering. Up a bit, down a bit. No big move, just tiny shifts every second. That’s what traders call “ticks.” And there’s a style of trading built around exactly that. It’s called tick trading.

    This isn’t some fancy or secret thing. It’s just a way of trading where you focus on every little price change, and make decisions based on that movement. Not time, not indicators, not forecasts — just the actual trades that are happening right now.

    Let’s break it down without overcomplicating it.

    What’s a Tick?

    A tick is the smallest movement a price can make.

    If a stock goes from ₹100.25 to ₹100.30, that’s a 5-paise tick. Some instruments might tick by 10 paise, some by 1 rupee. It depends on the market and the asset.

    But in general, every time the price changes — even a tiny bit — that’s a tick.

    And in tick trading, you’re trying to make money from those little moves.

    What’s a Tick Chart?

    This is where it gets interesting.

    Most traders look at charts based on time — like 1-minute, 5-minute, or hourly charts. But tick traders use charts that update based on the number of trades, not time.

    A 100-tick chart draws a new bar after 100 trades happen. If the market is quiet, that might take a while. If it’s active, that bar forms in a few seconds.

    That means your chart speeds up or slows down depending on how busy the market is — which gives you a better sense of actual trading activity.

    Why Use Tick Charts Instead of Time Charts?

    Time charts are useful, but they can hide what’s really going on when the market gets fast.

    Let’s say you’re using a 1-minute chart. That chart updates every minute, no matter what happens. But in those 60 seconds, the market might have exploded with trades — or gone completely quiet. The candle looks the same size either way.

    Now, a tick chart only updates when a certain number of trades have occurred. So if things are heating up, your chart moves faster. If it’s slow, it cools down. You can actually feel the market’s pace.

    And for a tick trader, that pace is everything.

    So, What Is Tick Trading?

    It’s trading based on the flow of trades — each tick, each change in price, each flash of volume.

    Instead of looking for long-term trends, tick traders look for:

    • Short bursts of momentum
    • Quick reversals
    • Breakouts that last seconds
    • Price patterns forming in real time

    It’s fast. It’s focused. And it’s not about holding overnight or watching the news.

    Tick traders might be in and out in seconds. Some hold for a few minutes. The goal is simple: catch small moves, stack small wins.

    How Do People Trade Using Ticks?

    There’s no single way. But here’s what many tick traders pay attention to:

    • Order flow – who’s buying? who’s selling?
    • Bid-ask spread – how tight is the price range?
    • Volume bursts – is someone suddenly stepping in big?
    • Micro-patterns – things like mini-flags or range breaks
    • Price action – just watching how it behaves

    And a lot of it is about feel. You don’t get that from a textbook. You get it from watching ticks for days or weeks, seeing how a particular instrument moves.

    Some traders even skip indicators altogether. Just raw price and volume.

    Tools You’ll Probably Need

    Tick trading isn’t casual trading. You need a setup that’s fast and responsive.

    • Low-latency trading platform
    • Real-time market data
    • Depth of market (DOM) view
    • Fast order execution
    • Hotkeys or one-click trading

    If your internet lags or your charts freeze, it’s a problem. You’re dealing in milliseconds here. Even a small delay can ruin the setup.

    And yes, many tick traders use algorithmic support — even if it’s just basic rules. Some build bots to enter and exit for them. Others stay manual but use alerts.

    Can Retail Traders Do Tick Trading?

    Yes — but with caution.

    Big institutions have a clear advantage here. They’ve got speed, capital, tech. But individual traders can still participate — especially in high-volume markets like:

    • Nifty futures
    • Bank Nifty
    • Liquid stocks like Reliance, HDFC Bank, etc.
    • USD/INR currency futures

    The key is staying realistic. Don’t expect to win every tick. Don’t overtrade. Start with tiny positions and just observe at first. See how price behaves. Learn when the market breathes — and when it jumps.

    Why Do People Choose This Style?

    Because they like to trade. They enjoy the rhythm. They don’t want to wait hours or days to know if they were right.

    Some say it gives them more control. Others feel it lets them reduce risk — since they’re only exposed for a few seconds or minutes at a time.

    But it’s not easy. Tick trading demands presence. You can’t walk away in the middle of it. You have to focus.

    And not everyone likes that.

    What Are the Risks?

    Plenty.

    • Overtrading – You might get sucked into every little move
    • Emotional fatigue – Constant focus wears you down
    • Slippage – The price you see may not be the price you get
    • Fees – All those small trades add up in costs
    • Whipsaws – Price fakes a move, then reverses fast
    • Burnout – It happens. Tick trading isn’t meant for 8 hours a day.

    That’s why most traders who do this well… don’t do it all day. They pick one or two windows where the market’s active — and that’s it. Done in 30 minutes. Maybe an hour.

    Final Thoughts

    Tick trading isn’t for everyone.

    It’s intense. It’s technical. And it can be unforgiving.

    But if you like short-term price action — if you’re someone who gets more out of one good trade than a full-day of watching — it might be worth exploring.

    Start slow. Watch first. Trade small. And build your understanding one tick at a time.

    It’s not about being right all the time. It’s about reading the rhythm of the market — and reacting with clarity when your moment shows up.

    Disclaimer:
    This blog is for educational use only. It does not offer investment advice or suggest any trading strategy. Tick trading involves high risk and is not suitable for all investors. Please consult a licensed advisor before acting on any financial information.

  • A Quick Guide To Price Action Trading

    Price action is the study of market price movement. Why not examine, analyse, and learn from the price itself?

    The price shown on a chart is based on the combined beliefs, knowledge, and actions of market participants. Buyers are in charge if prices rise. Prices falling suggests sellers are in command. In a sideways market, buyers and sellers cannot agree. Also, price action traders ignore fundamental events, believing the markets already know about them. For them, price movement is the best indicator. Price action is employed by everyone from ordinary investors to floor traders and even institutions. Price action is a fantastic approach to look at markets.

    Many believe that prices move based on public opinion. Because people can have opposing views while trading in the same market. There are two types of traders: those that buy an instrument when the price is approaching a resistance level, and those who wait to see if the price bounces off or breaks through. In any case, both traders appear to be wrong since they lack market knowledge and appear to be following the crowd. The financial markets are fundamentally unpredictable, making future price movements impossible to predict.

    Trading price action strategies requires the best Indian trading platform with a wide range of features. With Zebu, one of the best stock brokers in the country, your online stock trading journey will be drastically enha

    How to trade with price action

    Many price action trading methods use a two-step procedure to discover and exploit market trading opportunities.

    Find out what’s going on now.
    As previously stated, a market can go up, down, or sideways. Looking at the prices of various assets should reveal the market’s movement.

    Find the optimal trading moment.
    After determining the current market conditions, a trader looks for a profitable trading opportunity. If prices are rising, the price action should indicate whether prices will continue to rise or if a correction is imminent. For example, consider a price action trade in Reliance. Assume that INR 2,500 is a resistance. A price-action trader would wait for a break of INR 2,500 to buy Reliance. If it breaks out above INR 2,500, the stop loss would be below the previous support of INR 2,400.

    Most price action traders enjoy candlestick charts because they are informative and visually appealing. A candlestick shows the high, low, opening, and closing prices of an asset through time. A candle that closes higher than its initial price is green (bullish), while one that closes lower is red (bearish).

    By closely examining the prices, a price action trader can learn a lot about how the market operates. The size and information provided by a candle are determined by the pricing points used to create it. As a result, some candle types display bullish hammer, bearish hanging man, and neutral Doji. As time passes, a chart shows more and more candlesticks. When candlestick patterns appear on a chart, they reveal more price data.

    When employed correctly, candlestick patterns can show traders how the market moves like “confirmation, reversal, or neutral.”

    In any case, there are patterns that imply the dominating tendency will continue.

    Head and shoulders and double bottoms are reversal patterns that indicate the current trend is poised to reverse. Neutral patterns, like symmetrical triangles, can occur in any market and, while they indicate a major shift, they provide no direction.

    It’s more important to understand what they say than how they were made. Price action traders can utilise trendlines to find the right entry and exit.

    Price Action Patterns

    In price action tactics, you can find out what individuals are thinking by watching price fluctuations. These are some of the market’s most reliable price action setups.

    A long wick
    A candle has a body and wick(s). This is the distance between the opening and closing prices (the high and the low). Long wick candles are prized by price action traders because they reveal price movement. During that period, buyers tried to drive prices up, but sellers fought back, bringing prices back to where they started the day. A price action trader can now either back the sellers or wait for more proof. No matter how they seem, long wick candles are vital to price action traders.

    Inside bar
    Traders wonder if breakouts are legitimate when they occur. The term “within” refers to when one or more candles trade inside the major breakout candle’s high and low positions. This is called an inside bar. If an inside bar occurs after a breakout, it is a sign of the strength of the breakout according to price action theories.

    Trading Trendlines
    Trendline trading is the use of lines to determine the ideal places to enter trades in up or down markets. In an uptrend, a trendline is projected from a swing low to a swing high. It’s a “trend line.” Retracements to the trend line are effective entry points. In a ranging market, horizontal trendlines might identify support and resistance zones.

    Essentially, price action trading can be used to locate and trade low-risk, high-reward trades.

    If you are a price action trader or want to get started with this concept, you need the best Indian trading platform from the best stock broker to back you up. With our state-of-the-art platform, you can take your online stock trading to the next level. To know more about our products and services, please get in touch with us.