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4hr vs Daily Chart

  • Post #1
  • Quote
  • First Post: Jun 9, 2012 5:25am Jun 9, 2012 5:25am
Which is better for trading mid-term? I use the daily time frame but I back-tested a few months on the 4hr and seems it has more accuracy, especially from an entry point of view. My worry is whether it's as easy to "set and forget" trades on the 4h and whether intra-day noise would upset it's apparent advantages. I'll demo it for a few weeks to find these answers, but atm I'm after opinions from traders who use (or have used) both.

Thanks!
The 4 hour is not consistent across platforms. So your 4 hour may not necessarily be the 4 hour I see. Perhaps back test against several other brokers to see if in fact u have found something. I once played w/ what i was calling rolling 4-hour charts - had 4 diff brokers w/ differing time frames so that each hour was creating new 4 our bar on one of them. Nothing came of the research; or at least I couldn't find any thing of value to my methodology - but perhaps you may.
Also. you may wish to test against an hourly as its consistent across brokers.

Good Luck
In trading, there is no bullshit. You either make money or you don't.
Quoting mrgreen
The 4 hour is not consistent across platforms. So your 4 hour may not necessarily be the 4 hour I see. Perhaps back test against several other brokers to see if in fact u have found something. I once played w/ what i was calling rolling 4-hour charts - had 4 diff brokers w/ differing time frames so that each hour was creating new 4 our bar on one of them. Nothing came of the research; or at least I couldn't find any thing of value to my methodology - but perhaps you may.
Also. you may wish to test against an hourly as its consistent across brokers.

Good...
Hello mrgreen, thank you for the reply!
You are correct in what you say about brokers having different server times. However, do you also trade daily charts and what is the comparison with the daily and the 4hr time frame in your experience?
  • Post #4
  • Quote
  • Edited 10:06am Jun 9, 2012 9:56am | Edited 10:06am
Quoting pipprincess
Hello mrgreen, thank you for the reply!
You are correct in what you say about brokers having different server times. However, do you also trade daily charts and what is the comparison with the daily and the 4hr time frame in your experience?
I use the daily to plot/look for confluence of S/R, Trend Lines and MA's and to make a determination of the longer term direction. The 4 hour for me is used the same way for a bit more granularity - but its the 1 hour I watch to see how the market is taking care of itself as it approaches said confluence, while the 1/2 hour is used to monitor the action and 5-min to determine entries.

The above varies depending on the market general behavior. For instance- April on the eur/usd was a sideways market - so the 4 hour was more useful to me for determining direction - as no trend meant i switched to day trader mode. May - the daily was more determinant of the overall trend and so i went back to 'trend follower' mode. [NOTE: Its not easy to make this switch - takes a week or so - as being in day trader mode means my instincts are to bolt like a jackrabbit ]

1/2 hour and 5 min are my 'scalper' mode - when - like in April when i was in day trader mode.

The time frame is important to me because i am not interested in what I see - but what all the other technical people are seeing. I'm interested in what they may do.

PS: In reading the above - i realize i didn't specifically answer your question. I do not trade days charts if u mean entering a position and holding til the next day unless the market is telling me that is what I should do. The only 'hard and fast rule' I have is to never set 'hard and fast rules". Hope this helps.
In trading, there is no bullshit. You either make money or you don't.
That sounds like a very reliable and accurate method. I prefer price action to indicator based strategies myself.
Unfortunately however, I'm not able to monitor hourly charts normally because I have a full time job. It's possible to take to take a peek at MT4 on my android occasionally at work, but I don't want to *have to* do that and so that's why I started trading the dailies in the first place because they only needed checking once a day. My question about the 4hr chart is more about whether it gives you the best of both worlds, i.e., are you able to "set and forget" your trades on the 4hr if you have a full time 9-5 or does it need more monitoring and easily fall foul to intra-day noise. I can see how my first post could have been easily misunderstood so my fault entirely, apologies!
No reason to apologies. i also work full time - US Days - 6CST - 2CST. I one of those who is lucky or unlucky - (depends on how u view it) in that i don't sleep much. I don't have young children anymore- just my wife and me in this big house- its too quiet - so I trade at night 12AM - 5. I asked myself how bad I really wanted this - and well - that was my answer.
Being in the UK would suck (only for trading FOREX by the way - I'm sure everything else is pretty nice); but your trading is limited to end of NY and Asia session so when u are home - not much happening. But there is one benefit- in that the market moves much slower during those hours - great for just watching charts and seeing the movements.

In your situation - your forced to be a 'trend follower' - so you must embrace that method - accept that on average you'll have more losses than wins - but if you keep the losses small - when you do catch the trend- ride it for all its worth, you can be very successful. Read everything you can on trend following, eat it , breathe it, love it.
Good Luck to you -
In trading, there is no bullshit. You either make money or you don't.
Quoting mrgreen
Being in the UK would suck (only for trading FOREX by the way - I'm sure everything else is pretty nice); but your trading is limited to end of NY and Asia session so when u are home - not much happening.
I used to have exactly this view back in 2005 when I began with fx, lacked patience and was convinced that intra-day trading on the 1, 15 and 15 minute chart was where it was at. These days I don't agree with that, and I think the beauty of the daily chart (apart from it's reliability) is that it doesn't matter which session you find yourself awake in - you only need to manage your open positions or look for trade set-ups once a day regardless. I will just have to demo the 4hr set up to see if it can work in the same way.

Quoting mrgreen
In your situation - your forced to be a 'trend follower' - so you must embrace that method - accept that on average you'll have more losses than wins.
To be honest, I don't recognize any of this in my trading at all. I consider myself a short to mid term type trader, meaning that I usually hold a position for anything from a couple of days to a couple of weeks depending on how it develops, but I don't look for trends to follow as much as I look for chart patterns and price levels as signals to get into and out of trades. Around these ideas I've managed to create a method that produces far more wins than it does loses (some results will be published on my journal in time, for sure!), so all the things like time zones, trading styles and systems per se just aren't issues at this stage in my learning curve like they were in the past - and thank goodness for that too!

Quoting mrgreen
Good Luck to you
Thanks, I appreciate the good wishes!
Quoting mrgreen
The 4 hour is not consistent across platforms. So your 4 hour may not necessarily be the 4 hour I see. Perhaps back test against several other brokers to see if in fact u have found something. I once played w/ what i was calling rolling 4-hour charts - had 4 diff brokers w/ differing time frames so that each hour was creating new 4 our bar on one of them. Nothing came of the research; or at least I couldn't find any thing of value to my methodology - but perhaps you may.
Also. you may wish to test against an hourly as its consistent across brokers.
  • Post #9
  • Quote
  • Edited 7:25am Jun 10, 2012 5:44am | Edited 7:25am
Quoting pipprincess
Which is better for trading mid-term? I use the daily time frame but I back-tested a few months on the 4hr and seems it has more accuracy, especially from an entry point of view. My worry is whether it's as easy to "set and forget" trades on the 4h and whether intra-day noise would upset it's apparent advantages. I'll demo it for a few weeks to find these answers, but atm I'm after opinions from traders who use (or have used) both.

Thanks!
depends what you mean by better

The 4 hr chart is arguable the most accurate for picking the swings. Although I dont use it for entry, I certainly do respect support and resistance found on that time frame. If I was only allowed to use one time frame for analysis I would take the 4hr chart

The problem with trading it is you need to go to sleep at some point for about 8 hrs, so every 24 hrs your going to miss a candle close. This cant happen on the daily chart which is a close second for reliability. Once you get below 4 hrs its choppy and much more difficult to gauge direction. Thats where I live as a short term trader

If you can do well checking the market once a day instead of 6 times that you'll have to interupt your seep to achieve, that means you get to have a life as well as be a trader. There is a lot to be said for that imo
Thank you for replying to my question MacDoug

You've touched on the matter exactly because it's all those added candle closes that I'm worried about causing potential problems. I have an idea for a method based on the one that I use now but with some added tweaks for the 4hr chart. I'll only demo it for 10 or so trades because the main point is to see how much babysitting it needs. Or I suppose I could set my entries on the 4h with stops on the daily, but we'll see.
this has come to my realization that Daily time frame os more reliable than 4 hour in terms of trend following trading,if we want stress free,set and forget kind of approach for swing trading,DTf is better.
  • Post #12
  • Quote
  • Edited 8:31am Nov 4, 2019 7:29am | Edited 8:31am
You are not trading time !! you are trading the price in itself, there is no such thing as "best time frame" the "time" charts you are just looking the traces that the price left in the past, learn to trade the price on its own (read OHLC) and thats all you need

ever wonder why people says that higher timeframes are "more reliable? (LMAO) ?? you are STILL trading the right side of the chart and the price its ALWAYS the same value regardless the horizontal axis !!! time doesnt matter !! only price extremes and OHLC

When you place a trade you never say: "ok, lets buy 2 lots of 4 hours.. and lets put the take profit 12 hours.. or should i go for 13??.. mm if i use a 15 minutes stop loss this time should be fine"

Just no...

Evolve, trade the price, not the time =)
Why not trade both for a time then see which you prefer? Or carry on trading both? D1 can be a bit slow waiting for a decent set-up so it's really down to which suits your temperament...

Traders often want to know which style of trading is "best" in term of which is most profitable, but the more sensible question would be which style suits their personality. There's no point trading an amazing strategy if your temperament makes it impossible for you to execute it properly. Sometimes it's better to choose the less-profitable style which can be executed with the greater consistency.
  • Post #14
  • Quote
  • Last Post: Nov 4, 2019 11:33pm Nov 4, 2019 11:33pm
I am using H1 to trade daily break out at London session
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