Multiple Timeframe Trading Strategy Forex - Best Timeframe to Trade Forex
Multiple timeframe forex analysis equals using 2 forex chart time-frames to trade forex - a shorter forex chart time-frame used for trading & a longer forex chart time-frame used to check forex trend.
Since it's always good to follow the forex trend when forex trading, in Multiple Chart Time-frame Forex Analysis, the longer forex chart time-frame gives us the direction of the long term forex trend.
If the long term forex trend direction supports the direction of the smaller forex chart time-frame then probability of opening a profitable forex trade is significantly increased. This is because even if you make a mistake the long term forex trend will eventually save you. Also if you trade with direction of the trend, then mostly you'll be on winning side - this is what this Multiple Time Frame Forex Analysis is all about.
Remember there is a popular saying by many traders and investors that says: 'The forex trend is your friend' - never go against the forex trend when trading.
There are four different types of forex traders - all these different types of forex traders use different chart time-frames to trade as displayed below.
Examples of How Each Type of Trader uses Multiple FX Trading Chart Timeframes Analysis Strategy:?
Forex Scalpers - Multi Timeframe Scalping
Scalpers hold on to their forex trades for only a few minutes. Scalper forex trader never holds on to a FX trade for more than ten minutes. With the objective of making small amounts of pips as profit, 5 pips - 15 pips.
A Scalper using 1 min chart wants to go long, checks 5 minutes chart, which looks like the one below, since 5 minute chart show forex trend is moving up, then decides from this forex technical analysis it is okay to open a buy trade.
Multi Timeframe Scalping Forex - Multiple Time-frame Trading Strategy Forex
Forex Day Traders - Multi Timeframe Day Trading Forex - Multi Timeframe Intraday Trading Forex
Day forex traders hold on to their open forex trades for a few hours but not more than a day. With the aim to make quite a number of pips in profit, 30 - 60 pips.
Forex day trader trading 15 min chart wants to go long, checks 1 hour forex chart, which looks like the forex chart below, since 1 hour forex chart shows forex trend is moving up, then decides from this forex technical analysis it is okay to open a buy trade.
Multi Timeframe Day Trading Forex - Multi Timeframe Intraday Trading Forex - Multiple Time-frame Trading Strategy Forex
Swing Traders - Multi Timeframe Swing Trading Forex
Swing forex traders hold on to their open forex trades for a few days to a week. With the aim to make a large number of pips in profit, 100 - 250 pips.
Swing trader using 1 hour forex chart wants to go short, checks 4 hour forex chart, which looks like the forex chart example below, since 4 hour forex chart shows the forex trend is heading down, then decides from this forex technical analysis it is okay to open a sell trade.
Multi Timeframe Swing Trading Forex - Multi Time Frame Swing Trading Forex - Multiple Time-frame Trading Strategy Forex
Position Traders - Multi Timeframe Positional Trading Forex
Position forex traders are traders who hold on to their forex trades for weeks or months. With the aim to make a large number of pips in profit, 300 - 800 pips.
Position forex trader using daily chart wants to short, checks the weekly forex chart, weekly looks like the forex chart example below, since weekly forex chart shows the forex trend is heading down, then decides from this forex technical analysis it is okay to open a sell trade.
Multi Timeframe Positional Trading Forex - Multiple Time-frame Trading Strategy Forex
How to Define A Forex Trend
Using a forex trading system that has 3 forex technical indicators - Moving Averages Crossover System, RSI Indicator & MACD Indicator - & uses simple rules to define the forex trend. The rules are:
Upwards Forex Trading Trend
Both Moving Averages Moving Up
RSI Indicator Above 50
MACD Indicator Above Centerline
Downwards Forex Trend
Both Moving Averages Moving Down
RSI Indicator Below 50
MACD Indicator Below Centerline
