An impartial analysis will only reduce your odds in forex
Most traders only use one timeframe per chart when analyzing a pair. There is nothing wrong with the analysis, but traders who use only one timeframe will only get a little understanding of the movement of the pair, both in long-term (long-term trading) and short-term trading (short-term trading).
The analogy that adequately represents the above statement is as follows: Suppose I ask you the work capacity of your co-worker / partner; Of course you will be able to provide a complete and reliable opinion about the work aspect of your co-worker / partner. However, the same person is likely to have a different personality and capacity when we relate to other aspects of life; Say in hobbies, habits, and money management. And to really understand the person, it would be very relevant if we consider the outside aspects of the work he is currently engaged in. The same is true of pairs in forex trading.
Analyzing the movement of the pair in a timeframe is only part of the fact that applies to the pair. What we see on the D1 timeframe (daily) will be very different from the H1 (1-Hour) and H4 (4-Hour) timeframes; Although of course all have correlation of price movement. Thus, we can deepen our analysis if we try to understand the movement of the pair through more than one timeframe.
Price movements in a pair at any timeframe will move simultaneously; Therefore, it would be advantageous if the position opened later on a smaller timeframe (H1 or H4) is in the same direction of analysis with a larger timeframe (D1 or even W1). Trading by using the direction shown on the big timeframe (D1 up) and in tune with the long-term direction of the movement of a pair will increase your chances for profit in a position. In this case we take advantage of the advantages that long-term traders have in our analysis; Which they are able to reap huge profits in one position with a large "winning" ratio.
The whole process of this analysis (and other analyzes) always starts by identifying existing trends. And for this type of analysis, the trend can be identified at D1 timeframe (Daily).
Once we understand the direction of the D1 timeframe, we will go down to the lower timeframe to "fine tune" before opening the position. At the H1 chart above, the price looks for a moment of retraction after making a new high (at the end of the trendline line). So we use that level as the resistance level, and it will sell when the price touches that level again.
More optimal signal can be found in H4. But when on H4 chart there is a sideway or you are in doubt, you can go down to H1 to find the position.
If you are still confused, you can see the picture below as your guideline in understanding the concept and opening the position with this type of analysis.
Regardless of the type of trading you do; Whether you are a scalper, swing / position trader, this analysis can be part of your trade analysis.
If you notice, in the diagram above there are label short term, mid-term, and long term. The author himself is a swing trader, so the author uses D1 timeframe for long-term, H4 for mid-term, and H1 for short term. But if you are a trader who is in short term, then you can use H1 as long term, M30 as mid-term, and M15 or M5 as short term.
Most traders only use one timeframe per chart when analyzing a pair. There is nothing wrong with the analysis, but traders who use only one timeframe will only get a little understanding of the movement of the pair, both in long-term (long-term trading) and short-term trading (short-term trading).
The analogy that adequately represents the above statement is as follows: Suppose I ask you the work capacity of your co-worker / partner; Of course you will be able to provide a complete and reliable opinion about the work aspect of your co-worker / partner. However, the same person is likely to have a different personality and capacity when we relate to other aspects of life; Say in hobbies, habits, and money management. And to really understand the person, it would be very relevant if we consider the outside aspects of the work he is currently engaged in. The same is true of pairs in forex trading.
Analyzing the movement of the pair in a timeframe is only part of the fact that applies to the pair. What we see on the D1 timeframe (daily) will be very different from the H1 (1-Hour) and H4 (4-Hour) timeframes; Although of course all have correlation of price movement. Thus, we can deepen our analysis if we try to understand the movement of the pair through more than one timeframe.
Price movements in a pair at any timeframe will move simultaneously; Therefore, it would be advantageous if the position opened later on a smaller timeframe (H1 or H4) is in the same direction of analysis with a larger timeframe (D1 or even W1). Trading by using the direction shown on the big timeframe (D1 up) and in tune with the long-term direction of the movement of a pair will increase your chances for profit in a position. In this case we take advantage of the advantages that long-term traders have in our analysis; Which they are able to reap huge profits in one position with a large "winning" ratio.
The whole process of this analysis (and other analyzes) always starts by identifying existing trends. And for this type of analysis, the trend can be identified at D1 timeframe (Daily).
Once we understand the direction of the D1 timeframe, we will go down to the lower timeframe to "fine tune" before opening the position. At the H1 chart above, the price looks for a moment of retraction after making a new high (at the end of the trendline line). So we use that level as the resistance level, and it will sell when the price touches that level again.
More optimal signal can be found in H4. But when on H4 chart there is a sideway or you are in doubt, you can go down to H1 to find the position.
If you are still confused, you can see the picture below as your guideline in understanding the concept and opening the position with this type of analysis.
Regardless of the type of trading you do; Whether you are a scalper, swing / position trader, this analysis can be part of your trade analysis.
If you notice, in the diagram above there are label short term, mid-term, and long term. The author himself is a swing trader, so the author uses D1 timeframe for long-term, H4 for mid-term, and H1 for short term. But if you are a trader who is in short term, then you can use H1 as long term, M30 as mid-term, and M15 or M5 as short term.
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