Why are short timeframes so popular?
Since all people dream of earning money once and much, the intraday trade is very popular among traders. Newcomers are often sure that after having worked out a fx strategy for 30 minutes time frames and having trained to open and successfully close positions on a 5-minute fx strategy, they will quickly become market professionals. But, actually, it’s not true.
Who should better trade intraday?
Short time frames (5 minute Fx strategy, as well as a 15 minute Fx strategy) fit better experienced traders. Newbies better train on daily charts.
Why trade’s benefitable at the dayend?
You should trade as soon as the daily candle closed. And then you get the most benefit in a most cheap way.
The reasons are:
- Fx strategy on 30 minutes timeframes and even shorter time intervals cause the trader a very great psychological stress. But with day trading you spend much less nerves!
- In afternoon trade, the commission the broker is paid for fewer transactions (which ultimately translates into a much smaller amount) than working with minute timeframe strategy in Fx.
- Technical analysis on daily charts works better than, for example, with Fx strategy on the 15 minute timeframes.
- On the daily charts you can trade multiple currency pairs. No any Fx 1-minute strategy won’t physically give you the opportunity to track multiple currencies.
you shoul keep in mind
- Working on 1, 2, 5 minute charts, however, as a 15 minute Fx strategy, trader takes a lot of time and requires you to constantly be near a monitor. Of course, it is possible to trust an automatic EA, but the fact of the matter is that such a high-risk trade, as the same Fx 1minute accurate strategy requires constant monitoring and careful human intervention.
- You need good leverage, cos short-term operations yield is obtained with the help of leverage.
- Discipline and attention — that’s very important.
There are 3 main timeframes of minute strategies:
- Minute timeframe. Create a minute chart and place it on the indicators (Bollinger bands, and the curve of the exponential moving average of 100 periods).
- On 5 minute timeframe use 2 indicators – exponential moving average for 20 periods and the MACD histogram. Work while waiting for the reboot trend, but the benefit of this happens when the momentum of a trend change will be in size such as to be a source of larger-scale momentum. Then you can work on the trend and against-the-trend strategies.
- 15 minutes timeframe strategy is the most suitable for shortterm trading, cos they give the most relevant information for the market analysis. You can trade using a simple price chart candlesticks. Worth to buy when a trader notice 3 consecutive candles, the closing price which will be higher than the previous closing price. Respectively, to sell when three consecutive candles closing price will be lower than previous closing prices.