Using Multiple Time Frames
Posted By Forex
As you get deep into technical analysis of the Forex online you’ll want to know more about multiple time frames. You have to look at a currency pair and see what it did throughout a number of periods. So you may look at a 15 minute chart or at a one hour chart, for instance. The reason you have to do this to get a better assessment of the currency pair is because different investors offer different opinions and all may be correct.
The five minute chart may show a downtrend and the 15 minute chart may show that the downtrend came to an end. They’re both right and are reflective of investor sentiment.
This poses a problem especially for new traders as they don’t know which of the time frames to look at. This happens often when a newbie is looking to go short on the 4 hour chart but the 1 hour graph points to an upward trend instead. You certainly don’t want to flip a coin to decide on whether to go short or long.
This is why it’s so important that you take a Forex course and you become an ace at reading charts. One of the reasons most traders fail is because they choose the wrong time frames to go with their style.
So start by learning that you shouldn’t just be trading with what you see. Practice so that you can read charts like a pro and study all the time periods.