11 Oct Choosing multiple time frames
Choosing multiple time frames
As part of writing my trading plan I am writing this article on using multiple time frames. Together with choosing which time frames I will incorporate my strategy on how to trade these. This I will then test out and let you know what my experiences are with them. The article that brought me to try this out is from the good people at babypips.com.
Click here for my disclaimer. It basically says that I am on my path to becoming a trader and these are just my opinions on how to approach learning to trade. Feel free to check it out and comment on it.
Here it goes…
The recurring idiot
After reading that article on www.babypips.com I said to myself: “you idiot”. Makes total sense to use only 3 time frames. I was looking at too many charts. The daily, 4 hourly, 1 hourly, 30-minute, 15-min and finally the 5‑minute chart. So now that I established I am an idiot I have to choose the time frames that I want to test out first. Believe me, there will be more moments where I will shine as an idiot. Just keep following me.
Choosing time frames
So how do you go about choosing what time frames to use? I based mine on how ‘active’ I am when I am trading. Combine this with how active I’d like to be and I am left with the smallest time frames. I understand that this will require a lot of focus on my part but I am willing to try it out. In the end that is ‘all’ that you need to do. Try things out to see what fits your personality and trading style. So the time frames that I am going to trade are the 1‑minute, 5‑minute, and the 30-minute chart.
How to look at these charts?
I will use the 30-minute chart to determine the main trend. If the 30-minute shows me that there’s an uptrend I will only look for long positions and vice versa for a downtrend. On the 5‑minute chart I determine the current market bias to confirm price action is still following the main trend that we see on the 30-minute chart. On the 1‑minute chart I will time my entries and exits.
Test that sh*t
I need to determine a period for testing this ‘new’ approach. It should be long enough to actually give it a try but if you ‘feel’ like it’s not going to work you should not spend too much time on it. I will try these time frames for a week and review my findings on how it felt like trading them. Based on this I will either decide to extend using these time frames or switch to others. I’ll let you know how it goes.
Thank you again for reading and following me on my journey to becoming a trader. I am passionate about this and am convinced that I can be a trader. I understand it takes time because everything you want to be good at takes time. Please comment below on your journey or email me.