What are your preferred timeframes?

  • Hi guys,

    I personally prefer to work with greater timeframes (like H4 or D1) because the spread charged by the broker practically makes no difference Also, there are much less false signals. As a result the total profit is better than smaller timeframes, as well as the % of profit trades.

    I would like to ask, what timeframes do you trade and why?

    Thanks!
  • Hi fx18,

    I personally use daily chart and sometimes H4. Daily decrease number of trades that can be very helpful and I don't feel a need to trade. I can trade only when my set-up is present. Another advantage is time - I can trade only 15min a day and still make very nice profit.

    If you are sure your strategy is profitable and generates a few trades a month you can increase the risk per trade. When risking 3% per trade you can make 10% per month easily.
    I think every trader should start with daily (or even weekly) chart and only when he masters this timeframe he can lower TF.
    Hope it helps.

    Adam
  • Hey fx18,

    Having a full time job, I approach the markets as a part-time activity, then longer time-frames are more suitable for me. Weekly charts help me to draw a kind of global picture about the history of the asset. Daily charts give a more short-term pov and allow me choosing/confirming my position (long, short or aside). Endly, I "stalk" enties on H4 (or H1). Exits are managed on dailies and H4's.

    As you mentioned, the good point with larger TFs is that the "spread" is relatively lower compared to the expected moves. However, one comment on the following sentence:

    fx18:
    Hi guys,

    ...Also, there are much less false signals. As a result the total profit is better than smaller timeframes, as well as the % of profit trades...

    My mind is that I couldn't conclude as easily than you seems to do. I think there simply isn't correlation between time-frame and % of profit trade, because a lot of other market parameters can significantly influence your results (trending or not, volatility, "liquidity"...).

    Moreover, I would tend to think that you can perform better returns by day-trading, considering that you could have much more opportunities on smaller TF than larger ones.

    My two cents.
    Sebastien
  • Thanks Adam and Sebastian for your valuable feedback.

    @Adam I much like your approach, and this is what I try to follow.

    @Sebasrian What I meant is, I believe that there is correlation between higher timeframes and the quality of the trades I take. For me, and particularly as a beginner, it is better to reduce the frequency of trades I take in favor of fewer but quality trades. This would lead to a better profit factor (has nothing to do with size of profit itself). Do you agree with this thesis? smile
  • Hi guys,
    my issue with higher time frames is/was that i had to wait so long for a good setup that i would convince myself into taking trades i shouldn't, saying 'i have been waiting for this retracement to end for 2 weeks now, i have a poor signal but if i don't trade it, it might be another 3 months before i get something similar on the same currency pair'. If you trade high timeframes you will have to monitor more markets to reach profitability anywhere near what a trader can who looks at 1h charts. Regards.
    Peter
  • fx18:
    Thanks Adam and Sebastian for your valuable feedback.

    @Adam I much like your approach, and this is what I try to follow.

    @Sebasrian What I meant is, I believe that there is correlation between higher timeframes and the quality of the trades I take. For me, and particularly as a beginner, it is better to reduce the frequency of trades I take in favor of fewer but quality trades. This would lead to a better profit factor (has nothing to do with size of profit itself). Do you agree with this thesis? smile



    The correlation between higher TFs and the quality of the trades is non-sense I think. You can patiently wait on lower TF and to have the same quaility of trade but it requires much more discipline to trade properly. And trading good setups on daily is not as easy as it sounds because you have to wait sometimes for weeks to open a trade and it is very difficult in my opinion. Sometimes I feel temptation to trade because of being flat for so long time.
    When speaking about profit factor it is not dependent on TF. It is defined as he gross profit divided by the gross loss (including commissions) for the entire trading period. It means if you cut your losses and let your winner run you will achieve high profit factor(PF). However PF slighty above 1 in long-term indicates very good system.

    It doesn't matter what reason is, trading on daily chart is the best possible start. If you can't be profitable on daily charts you can't be profitable on lower TFs. I like your idea of starting with daily. Keep trading and let us know about your progress.

    Good luck!
  • last edited Dec 2 2013 4:19 pm
    fx18:
    ...
    @Sebasrian What I meant is, I believe that there is correlation between higher timeframes and the quality of the trades I take. For me, and particularly as a beginner, it is better to reduce the frequency of trades I take in favor of fewer but quality trades. This would lead to a better profit factor (has nothing to do with size of profit itself). Do you agree with this thesis? smile

    Despite I don't entirely agree with you on one point, your pov is actually much more clearer now for me. However, I still tend to think that reducing the frequency of trades don't help you to improve your making decision process and thus, don't guarantee any results. Basically, if systemic errors are done, force himself to reduce frequency of trades, induces only one thing: you should take more time to realize that your "system" or methodology is completely or partially wrong. So to conclude, I think that "a good idea" is not correlated to the frequency of it.

    Now, to bounce of what Peter mentioned in another manner in his last post, I think that the higher the TF, the more difficult it is for some kind of beginners (like me) to be patient enough and wait for the correct moment to place the order. Moreover, and according to one of my beliefs, the higher the TF, the bigger your account must be, and this is an important consideration to have before using a home-made "system" or picking an already existing one.
  • @Peter You're making a very good point! Probably, trading on daily charts would be then best suitable for an EA smile

    @renorx54
    "Moreover, and according to one of my beliefs, the higher the TF, the bigger your account must be."

    I would say, not necessarily. Using varying lot sizes (by scaling in amd out the trades), you still can trade with the same account balance like with smaller timeframes. Am I right?
  • Hi fx18,
    Large time frames have to be traded with larger accounts especially if you want to scale in and out. 1 micro lot is $0.1 on majors, and you have to place sometimes 100pip SL. That means the minimum risk you can take is $10 and if you want to risk 1% of your account on your trade and scale as well you will need $2000.
  • Got it! Many thanks Peter for explanation.

    @renorx54 my assumption was just pretty wrong. Oh dear! still so much to learn.
  • You can opt for Ayondo Markets as your broker they allow you to place as little orders as €1 on EURUSD but that's not conventional broker practice.
  • Good to know. However, social trading is not that helpful for me to learn Forex in depth. I am keen to learn Forex strategies as much as I can on MT5. This is my favored platform because of all the more and new technical possibilities provided.

    I already opened a live MT5 account with Sensus as the only partner broker who offers MT5. Unfortunately, there are no tradimo points connected with. So I can't unlock more training stuff while achieving a higher status frown
  • You can earn tradimo points with all live accounts opened through us. You might have forgotten to register you account:
    http://en.tradimo.com/help/accounts/
  • Yes, I already registered my account few days ago. When I open this link, my account is displayed correctly for the entry field "Sensus personal account number".
  • When did you place your first trades?
  • I have not made live trades yet, still testing on demo account.
  • You only get points if you make trades on live account smile
  • Oh, I see. No pain, no gain smile I will trade enough soon but after I finish the backtesting biggrin
  • I like your patient, determined, calculated approach. I am confident it will pay off on the long run! Good luck, and i hope you share some of your insights with us in a Blog when you are ready!
  • Many thanks! Yes, I will. Your encouraging efforts for Forex beginners and excellent support is second to none!

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