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Question on Time Frames....

  • #1
  • First Post: Apr 27, 2007 7:29am Apr 27, 2007 7:29am
Hello Everyone:

I'm hoping I can get some different views to my question.....

When I'm working off of a 4 hr chart and waiting for my signals to give me a buy or sell signal, I will sometimes go over to the hour time frame. When I switch to that time frame, I obviously see the move has already been made on that time frame. I then start thinking to myself, would I be better off working off of the hour time frame, maybe my signals work better there than the 4 hr time frame and start to question, which is better.

I would love to hear any comments anyone has on this subject. Your input, would be much appreciated.

Thanks so much Forex Factory....

Marc
  • #2
  • Apr 27, 2007 7:46am Apr 27, 2007 7:46am
Here's my experience with trading trends on multiple time frames...

Let's assume the 4 hour is down... and the hour is up. Price may be rising, but not as fast as it will fall when the hour turns back down to match the "bigger picture" that the 4 hour shows.

That being said, I trade more than just the 1hr/4hr. I also notice exactly what "hour" of the "4-hour" it is... if the move is heading up and it's the last hour of the 4 hour it may be a new trend... if the hour in question is the 2nd or 3rd hour of the 4 hour then I just wait for the direction to match.

Try trading more timeframes and I think you'll see the relationships are the similar amoungst them all. 15M to the 30M to the 1HR to 2HR to 4HR, etc...
  • #3
  • Apr 27, 2007 7:49am Apr 27, 2007 7:49am
Thanks for the reply...

So, If I'm working off the 4 hr, see what the 1 hr or 2 hr is doing and once they match on the 4 hr if we have a certified trend then that is where I should be thinking to get in?



Quoting AggieTrader
Here's my experience with trading trends on multiple time frames...

Let's assume the 4 hour is down... and the hour is up. Price may be rising, but not as fast as it will fall when the hour turns back down to match the "bigger picture" that the 4 hour shows.

That being said, I trade more than just the 1hr/4hr. I also notice exactly what "hour" of the "4-hour" it is... if the move is heading up and it's the last hour of the 4 hour it may be a new trend... if the hour in question is the 2nd or 3rd hour of the 4 hour then I just wait for the direction to match.

Try trading more timeframes and I think you'll see the relationships are the similar amoungst them all. 15M to the 30M to the 1HR to 2HR to 4HR, etc...
  • #4
  • Apr 27, 2007 8:18am Apr 27, 2007 8:18am
Quoting marcf
Thanks for the reply...

So, If I'm working off the 4 hr, see what the 1 hr or 2 hr is doing and once they match on the 4 hr if we have a certified trend then that is where I should be thinking to get in?
Hi Marc
My way is to move to lower TFs simply to look for entries to fine tune what I've seen on the higher TFs.
Essentially I work off the daily charts and work progressively down to lower TFs to look for potential dips to trade (long) and vice-versa.
So as soon as I see a retracement on the daily I start looking for an entry point.
Beware of using the words 'certified trend' as it may lead you down the wrong route, rather think that the current trend, on the longer TF chart, appears to indicate possible opportunities in the lower TFs IF the prevailing trend continues.
One advantage of using lower TFs is, I feel, that if you dislike large stop-losses you can seek out short-term support/resistance areas closer to your planned entry point, and therefore keep your losses on bad trades to a minimum.
I look forward to other points of view as I still consider myself a newbie and am happy to stand corrected by those with greater experience.
  • #5
  • Apr 27, 2007 8:49am Apr 27, 2007 8:49am
Quoting marcf
Hello Everyone:

I'm hoping I can get some different views to my question.....

When I'm working off of a 4 hr chart and waiting for my signals to give me a buy or sell signal, I will sometimes go over to the hour time frame. When I switch to that time frame, I obviously see the move has already been made on that time frame. I then start thinking to myself, would I be better off working off of the hour time frame, maybe my signals work better there than the 4 hr time frame and start to question, which is better.

I would love to hear any comments anyone has on this subject. Your input, would be much appreciated.

Thanks so much Forex Factory....

Marc
4 hour is great!!
it is what the big boys use.
use 30 mins for your buy & sell signs
use the same system...or make it simpler
- you can use only one tool or two
if its working now you will be amazed how much better you will trade!!
TEB
  • #6
  • Apr 27, 2007 8:51am Apr 27, 2007 8:51am
Thanks TEB....

But, what do you mean bu use the 30 mins for my buy & sell signs?

Marc

Quoting TEB63
4 hour is great!!
it is what the big boys use.
use 30 mins for your buy & sell signs
use the same system...or make it simpler
- you can use only one tool or two
if its working now you will be amazed how much better you will trade!!
TEB
  • #7
  • Apr 27, 2007 9:08am Apr 27, 2007 9:08am
"As a trader, you need to ask yourself if you are going to use the same time frame for signals, entries and exits or go to a lower time frame for the entries and /or exits. This is a common practice but hard for beginning traders to do as they tend to focus on the lower time frame instead of waiting for the signal to setup on the main time frame. Once you have learned to do it though, it should improve your results."

http://www.trading-naked.com/StopsandExitsbyBUFFY.htm


on the other side, there are traders that say: treat each timeframe as a separate market...

so, theres no wrong or right, in end its up to you...as always..
  • #8
  • Apr 27, 2007 1:46pm Apr 27, 2007 1:46pm
Quoting marcf
Thanks TEB....

But, what do you mean bu use the 30 mins for my buy & sell signs?

Marc
I use 3 time frames mostly but you can get away with two
& I will often trade just with the 2

1. Day is for the trend & its a cover chart
( the day chart or stoch) will begin to flatten before it dropped
& so dropps the 4 hour ..

2. THe 4 hour Chart is the one I trade on - the base

3. 30 min Chart breaks down the 4 hour so I get a better in & our

ie. Day is up that is the trend
4 hour is up that is my trading chart .. I could go in now
30 min gives me a better in or out on the 4 hour

TEB
  • #9
  • Apr 27, 2007 2:00pm Apr 27, 2007 2:00pm
Have you tried using the same indicator values on the 1hr as you do the 4hr? So lets say you use a 5/10 ema cross on the 4hr, have you attempted to use a 20/40 cross on the 1hr instead?
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #10
  • Apr 27, 2007 2:02pm Apr 27, 2007 2:02pm
I haven't tried that..what are your thoughts on that? Have you had better success at doing that?

Quoting StockKJay
Have you tried using the same indicator values on the 1hr as you do the 4hr? So lets say you use a 5/10 ema cross on the 4hr, have you attempted to use a 20/40 cross on the 1hr instead?
  • #11
  • Apr 27, 2007 10:36pm Apr 27, 2007 10:36pm
Quoting StockKJay
Have you tried using the same indicator values on the 1hr as you do the 4hr? So lets say you use a 5/10 ema cross on the 4hr, have you attempted to use a 20/40 cross on the 1hr instead?

I always do.. I use 5.3.3. stoch on all time frames
TEB
  • #12
  • Apr 27, 2007 11:14pm Apr 27, 2007 11:14pm
Quoting marcf
I haven't tried that..what are your thoughts on that? Have you had better success at doing that?

There's no "Holy Grail" in trading, but working in MTF is the closest thing I think.
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  • #13
  • Edited 6:31am Apr 28, 2007 6:17am | Edited 6:31am
its indeed good use wide range of time frames to get the "over all" picture. and to have enought space between eatch perspectives. to confirm price actions.

my personal point of view is that
Close observation of changes 1M-15M.
Middle observation of reactions 30M-4H.
Distant Observations of resoults 1D-1Month

depends on the trader what time frames feels more indicative.

but they work allways in both ways confirming the price actions. Distant perspective needs the closer perspective to exists and vise versa.
  • #14
  • Apr 28, 2007 6:39am Apr 28, 2007 6:39am
As a raw newbie I am following this discussion with great interest but the indicator which confuses me most is stochs. Over the past few days I managed to make a few pips on cable but could have made many more had I ignored the stochs which were telling me the pair was overbought/oversold when my other indicators were telling me to buy/sell. When is it safe to ignore stochs and when is it important not to ?
  • #15
  • Apr 28, 2007 7:21am Apr 28, 2007 7:21am
Quoting bundubill
As a raw newbie I am following this discussion with great interest but the indicator which confuses me most is stochs. Over the past few days I managed to make a few pips on cable but could have made many more had I ignored the stochs which were telling me the pair was overbought/oversold when my other indicators were telling me to buy/sell. When is it safe to ignore stochs and when is it important not to ?

Friday is a strange day.. the big boys take their money & run so trends reverse ... but what stochs where you using.. on what time frame? what setting? stochs simply tell you what is going on- buying over selling or reverse?

  • #16
  • Apr 28, 2007 7:30am Apr 28, 2007 7:30am
Quoting TEB63
its better having more space between your TF... you want to pick up strengh or weekness coming into the market.. the 15 & 30 charts tell you almost the same thing.

you know the big boys go have a very well know system - both in Stocks & Forex & every thing else that is traded -- its 4 TFS
it is week, day, 4 hour, hour,

I changed it a little because 4X is so fast & trends so well
I do - day, 4 hour , 30 mins ( but I keep an I on the week)
MTF from the top down is much stronger then the botton up as well
because of the power of the trend - other wise you will be blind sided!!

TEB
Hi TEB,
Actually in my own trading I use Daily, H4, H1, and M15. The screen I posted was to show Marc how lower TFs simply show a break down of what is going in a larger TF.

I can look at the H4 and pretty well get the weekly movement of price and also the Daily and pretty well get the monthly movement of price.

I find the M15 useful not for trend identification, but solely for pinpointing where I want to enter.
  • #17
  • Apr 28, 2007 8:03am Apr 28, 2007 8:03am
Quoting TEB63
Friday is a strange day.. the big boys take their money & run so trends reverse ... but what stochs where you using.. on what time frame? what setting? stochs simply tell you what is going on- buying over selling or reverse?

Hi TEB,

Thanks for you comments I was using 5,3,3 on 1H time frame for no good reason except I have seen others on this forum using the same. Should my settings vary according to the time frame ?
  • #18
  • Apr 28, 2007 8:16am Apr 28, 2007 8:16am
Quoting bundubill
As a raw newbie I am following this discussion with great interest but the indicator which confuses me most is stochs. Over the past few days I managed to make a few pips on cable but could have made many more had I ignored the stochs which were telling me the pair was overbought/oversold when my other indicators were telling me to buy/sell. When is it safe to ignore stochs and when is it important not to ?
Theres a multiple diffrent ways to combine and use indicators. I dont have personaly deep usage with stoch but i do used it for awhile. how i personaly observed it as how market pressure behaves in more closer perspective of variable of time.

Indicators uses only an varios amouth of information from the market data, what is the refered as variable setting in use. as the market condition moves more radicaly inside that period of time what indicator is useing. it goes of out of perspective. Indicator returns again in more normal pressure readings as more upcoming information is "neuralising" the radical behavor.

Radical behavour is only in mather of perspective. if market have attended move more radicaly inside that variable of time used on indicator. it creates an avarange perspective of that radical behavor. As more information comes available while market moves. indicator adjust it self in that current moment of variable used. While market moves more calm. the indicator adjust in that avarange movement and only needs small move to create an radical impact on indicators behavor.

As more information comes available when market moves on. observations can be made how the price pressure behaves inside thos variables and to indicate possibility of change on reaction. Meany types of Oscillator based indicators as Stoch and RSI. The Variable used in indicator creates information of market pressure happening inside that Time(varible) of market data. That creates on more closer perspective of the market pressure happening in the middle of thos variables.

Indicators shows the "starting" and "ending" of the reaction inside thos variables used. and will take unknown amouth of time to come again in middle of perspective. as more market data is needed to adjust on the current radical behavor. As that Radical behavour becomes more Avarange market behavour. more radical behavour is needed to have an reaction inside thos variables.
  • #19
  • Apr 28, 2007 11:42am Apr 28, 2007 11:42am
Quoting TEB63
some people of coarse
but the big boys trade on the 4 hour & up I am speaking of banks & funds...
the only time they come down to the time frames you speak of in news events ..
they have to much money to play in the 15....
look at a month chart very easy to see trend look at a 15 min much harder...
if I had the money I would only trade week & month

Point well made. But I operate under the theory that

**the larger your account size the larger TF you would use to trade**

It's not practical for me to use weekly and monthly although I do reference them from time to time. On a daily basis however, I rely on the H4 and Daily to gauge a trend and the lower TFs for determination of my entry point.
  • #20
  • Apr 28, 2007 12:01pm Apr 28, 2007 12:01pm
Quoting bundubill
As a raw newbie I am following this discussion with great interest but the indicator which confuses me most is stochs. Over the past few days I managed to make a few pips on cable but could have made many more had I ignored the stochs which were telling me the pair was overbought/oversold when my other indicators were telling me to buy/sell. When is it safe to ignore stochs and when is it important not to ?
Hi Bund,
I don't ignore the Stochs. They are a key indicator to tell you more about momentum than the standard OB/OS interpretation. Just because it may show OB/OS on one timeframe doesn't mean that price has necessarily lost momentum. Stochs are great to use especially when you use them on MTFs. Take at look at Spuds thread on stoch. He gives a simple and very practical application of Stochs. Best I've seen.
http://www.forexfactory.com/showthread.php?t=22105


You can also try
http://www.forexfactory.com/showthread.php?t=13321

and
http://www.forexfactory.com/showthread.php?t=20975
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