Are You Trading the Right Timeframe?
Posted by Edward Dy on July 28th, 2008
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Photo Credit: TheChristianAlert.org
A lot of traders aren’t doing too well simply because they have chosen the wrong trading timeframe. So what then is the right timeframe? Well it depends on your personality. If you’re new to currency or forex trading, your tendency would be to make big bucks quick and so you start trading small timeframes, say the one or five minute charts. However, this isn’t always the best approach, since you may have traded the wrong timeframe for your personality.
So, the best way for you to find out which timeframe suits you best is to take it easy at first. Experiment a bit without taking a lot of risk. Try and see if you’re comfortable trading the one hour charts. You will notice that this timeframe is longer, and might suit you just fine and without the feeling that you’re being rushed.
There are people, on the other hand, who find the one hour timeframe too long and too slow. They could never trade that way since they would become very impatient. Traders of this type would be better off trading a ten minute chart, which, because of their personality, allow them mple time to make correct decisions based on their trading plan.
On the other extreme, a world renowned buisnessman and philantrophist by the name of Warren Buffet, wouldn’t understand at all how he can trade a one hour chart. For him this timeframe is too fast. He prefers to trade only daily, weekly, and monthly charts.
To come right to the point, the right timeframe for you depends entirely on your personality. If you’re comfortable with the timeframe you’re trading, then that’s the right timeframe for you.
Don’t think just because you’re nervous, feeling somewhat pressured rfrustrated that you’re trading the wrong timeframe. The reason you’re feeling pressured could be because you are trading real money, and so it’s normal for anyone to feel that way. However, if the reason you feel pressured shouldn’t be because you think things are happening too fast, then you’re trading the wrong timeframe, which will make it difficult for you to make the right decisions.
In the end it’s you alone who can determine what the correct timeframe should be.
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