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Day Trading vs. Swing Trading vs. Position Trading 86 replies

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B.S. Trading with Kenneth Lee

  • #1,861
  • Jan 4, 2012 6:11am Jan 4, 2012 6:11am
Quoting bullzeye
both targets were hit...E/U now long on m30 supply
Yep,

But I like the lower level...

Congratulations on both hits!
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  • #1,862
  • Jan 4, 2012 6:31am Jan 4, 2012 6:31am
Quoting Tauru$
Yep,

But I like the lower level...

Congratulations on both hits!
indeed, i have another buy limit down there...
  • #1,863
  • Jan 4, 2012 6:31am Jan 4, 2012 6:31am
Hi Tauru$
I know what you mean r.e. the lower level on EURUSD but there is a nice channel+TL on EURUSD as well so it does make sense for price to reverse round there. I'm on the sidelines and will wait and see...

Nice channel on GBUSD as well but it's far steeper-that's a pretty strong move to the upside.

[EDIT] Apologies-Supply line on EURUSD is drawn incorrectly. It should be drawn at the base of the green candle that preceeds the large drop in price.
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Click to Enlarge Name: gbusd 4hrchannel.gif Size: 16 KB
  • #1,864
  • Jan 4, 2012 6:32am Jan 4, 2012 6:32am
USD/CHF looks good so far

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  • #1,865
  • Jan 4, 2012 6:33am Jan 4, 2012 6:33am
Quoting bootsyjam
@ Ultimatus

One of the reasons that I'm moving away from lower tfs is that there is just too much noise, even on the 1 hour chart to be honest. .
I have never understood this story of low TF are more noisy than big TF.

When you have a currency with lot of liquidity i personally don't see the difference. For me a daily chart is as hard as a M5 to analyse.

Maybe for somebody it's different

When i see a daily chart and a M5 chart as below, i see the same chaos on both charts!!

If someone can tell me which chart just below is the M5 and which chart is the daily....

For me the big problem of a lower TF is the spread which cost a lot on a M5 and M1.
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: eu2.jpg Size: 52 KB
I hear and I forget. I see and I remember. I do and I understand.
  • #1,866
  • Jan 4, 2012 6:51am Jan 4, 2012 6:51am
Hi boubfax
When I talk about noise, this is what I mean.

If you have a 4 hour chart, and are marking out S/D levels on it, then you only have to look at the following tfs to ensure your SD levels are valid: Daily and Weekly (not even the weekly sometimes). The volume required to drive prices from these areas is huge, and these are the main price points for the fx market. The big boys who drive prices all look at these areas.

Now marking S/D levels on a 5 minute tf?
You have to look at your 15/30 min chart to see what else is around. Then the 1 hour chart, then the 4 hour chart to see if you're near any other levels. The the daily just to make sure you're not near a SD zone there too.

And here's the big thing as well-the S/D ratios aren't perfect, prices can overshoot a bit sometimes before returning to equilibrium to stop the price move, before reversing and moving the price in the direction that you want it to go.
And with a 5 min chart, you're using tight stops so your timing regarding when you expect prices to revert to an equilibrium to balance each other out and stop the price has to be pretty much perfect, you can't allow for much overshoot. So you can be stopped out even if you're in the right area. Of course, the reward is huge if you can do this, but then the good old ying and yang steps in here, because so is the risk. I can be stopped out 3 times in a session using the 5 min charts and their respective tight SLs.

Also, looking at a 5 min chart, how many times do you change your mind over the course of a trade? I'd bet it's quite a lot!

Having said all that, I'm sure there are people out there who can trade effectively using the 5 min chart, I'm just not one of them.

The bottom line for me is that using 5 min charts requires a lot of analysis over different tfs, and in my case I lose sight of the big picture, so to keep that big picture in my head I just stay away and take my time.
I've always been more successful on longer tfs, but as Ultimatus stated, I'm very similar to him in the sense that day trading habits, with the desire to take a profit from each trading session, is a hard habit to break, so I avoid looking at the short term charts.

If there are people out there who can trade the 5 min charts then please go ahead and help, I just know that it doesn't work for me.
  • #1,867
  • Jan 4, 2012 6:54am Jan 4, 2012 6:54am
As a guess, I'd say the first chart is a long term chart, and the second is a short term chart.
The reason being, the SD levels are clearer and respected more often on the 1st chart! That's why I like the longer tfs.
I'll look like a right ar*e if I'm wrong though...
  • #1,868
  • Jan 4, 2012 7:03am Jan 4, 2012 7:03am
Quoting zamfir
My view of Audusd Daily...We are going into weekly demand level. The Weekly demand level is pretty big.

I would wait and see how it reacts at this level.
Thanks for reply, buddy Happy trading
  • #1,869
  • Jan 4, 2012 7:06am Jan 4, 2012 7:06am
Just to add to what bootsyjam has said...I agree completely about the noisey small timeframes, while they may work for some people, you have to do a lot more analysis and do it faster, and as he mentioned you are subject to more whipsaws.

I traded m5 for a long time but in the end got frustrated due to the levels just not being reliable. You could say I was picking the wrong levels, however its easy to say it after the fact, not so easy in the live environment.

I think most 'big players' are looking at h1 and above, these levels are clear for all to see so are more likely to hold if the majority are trading in the same place.

Some of my best trades have been taken off h1/h4 levels, but I like to go down to a lower timeframe to decrease risk and increase reward.

EDIT: also, forgot to mention, when I use to trade m5/m15 etc I often lost sight of the big picture and found myself missing some huge trades that otherwise I would have taken if I was paying attention to the higher time frames!
  • #1,870
  • Jan 4, 2012 7:11am Jan 4, 2012 7:11am
Quoting bootsyjam
As a guess, I'd say the first chart is a long term chart, and the second is a short term chart.
The reason being, the SD levels are clearer and respected more often on the 1st chart! That's why I like the longer tfs.
I'll look like a right ar*e if I'm wrong though...
The answer my friend

It's the EU, so there are lot of liquidity.

On a UJ or UC for example where there are less liquidity, M5 are very noisy chart, with plenty strange candles.
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I hear and I forget. I see and I remember. I do and I understand.
  • #1,871
  • Jan 4, 2012 7:13am Jan 4, 2012 7:13am
Am now long EURUSD, SL 1.2907, target 1.3060
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  • #1,872
  • Jan 4, 2012 7:15am Jan 4, 2012 7:15am
Quoting boubafx
I have never understood this story of low TF are more noisy than big TF.

When you have a currency with lot of liquidity i personally don't see the difference. For me a daily chart is as hard as a M5 to analyse.

Maybe for somebody it's different

When i see a daily chart and a M5 chart as below, i see the same chaos on both charts!!

If someone can tell me which chart just below is the M5 and which chart is the daily....

For me the big problem of a lower TF is the spread which cost a lot on a M5 and M1.
I've learned this aspect of TF difference at Pip Easy's thread ...
  • #1,873
  • Jan 4, 2012 7:15am Jan 4, 2012 7:15am
Quoting bootsyjam
Hi boubfax
When I talk about noise, this is what I mean.

If you have a 4 hour chart, and are marking out S/D levels on it, then you only have to look at the following tfs to ensure your SD levels are valid: Daily and Weekly (not even the weekly sometimes). The volume required to drive prices from these areas is huge, and these are the main price points for the fx market. The big boys who drive prices all look at these areas.

Now marking S/D levels on a 5 minute tf?
You have to look at your 15/30 min chart to see what else is around. Then...
You are right, buddy, there're lots of noise in a smaller time frame. There's nothing wrong if we trade on larger time frame As long it can makes profits, right?

By the way, I seldom zoom into 5minutes chart =.= I often trade on 1 hour chart, I will zoom into 30minutes chart or maximum 15minutes. When I saw a level on larger time frame, I'll zoom into smaller time frame, and have a look whether is there any level inside the level that I picked on the larger time frame. If there's a level inside the level that I picked on the larger time frame, then I might set my entry at that smaller time frame, but the stop loss and take profit target, I will just follow the larger time frame SL and TP, I won't analysis the smaller time frame chart to find another SL & TP for smaller time frame =.=" So, after all, I might only spend 1 minute on the smaller time frame, if there's no good level on smaller time frame, I will just set my entry on the larger timeframe. That's all =.=" I just spend around 1 minute on small time frame and I don't see that I need to use lots of analysis...
  • #1,874
  • Jan 4, 2012 7:18am Jan 4, 2012 7:18am
@ boubfax-aaaah I didn't know it was a different pair each time!
I don't touch the yens-don't understand them, is high risk of govt intervention at any time, and they move in different sessions/different times so I leave them well alone.
  • #1,875
  • Jan 4, 2012 7:26am Jan 4, 2012 7:26am
Quoting anthony_tzw
You are right, buddy, there're lots of noise in a smaller time frame. There's nothing wrong if we trade on larger time frame As long it can makes profits, right?

Yes you're right, trade HF is not wrong or a shame.

LTF= more setup, but more risk bcs spread cost

HTF= less setup but less risk , spread cost a little
I hear and I forget. I see and I remember. I do and I understand.
  • #1,876
  • Edited 8:05am Jan 4, 2012 7:54am | Edited 8:05am
Quoting boubafx
I have never understood this story of low TF are more noisy than big TF.

When you have a currency with lot of liquidity i personally don't see the difference. For me a daily chart is as hard as a M5 to analyse.

Maybe for somebody it's different

When i see a daily chart and a M5 chart as below, i see the same chaos on both charts!!

If someone can tell me which chart just below is the M5 and which chart is the daily....

For me the big problem of a lower TF is the spread which cost a lot on a M5 and M1.

If you want to make this as complicated as you can it is possible.

The statement . The lower time charts have more noisy , is the fact that for each 4 hr candle there are 8, 30 min candles WITHIN Each 4 hr candle or 16 15 min and 48 5 min candles.

This can make it harder to see a clear picture. that doesn't mean that at times the faster charts don't have a clearer entry they do. This is why we use them together. The level say on a 4 hr could be higher where as one on a 1 hr or 30 min is crystal clear and spot on .

On the very fast charts of 5 min and down , they will show levels within the actual turns that can happen at the very top or bottom of a level. We tend to always have at least one candle or two at the very tops or bottoms before price turns back. So say we had one 4 hr candle at the top of a turn , if we look on a 5 min chart we had 48 candles to help us see a great short entry , as close to the top of a supply level, so less risk.

But if you trade off just your 4 hr chart all those 48 candles are just noise. Because you just follow the yellow line back and you can clearly see your entry,
Attached Image(s) (click to enlarge)
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Good Trading To All ; Ken Lee
  • #1,877
  • Jan 4, 2012 8:04am Jan 4, 2012 8:04am
1st trade of yr 2012...
EU 100pips
Attached Image
  • #1,878
  • Jan 4, 2012 8:07am Jan 4, 2012 8:07am
aaaah 4 hour charts how i adore thee
Nice one Android
  • #1,879
  • Jan 4, 2012 8:13am Jan 4, 2012 8:13am
Quoting Android38
1st trade of yr 2012...
EU 100pips
Attachment
awesome mate! are the blue areas on your chart just areas you have filled in yourself or is this a indie of sort?
  • #1,880
  • Jan 4, 2012 8:16am Jan 4, 2012 8:16am
the key to using different time frame charts together is to always line up the trends , the more that the time frames agree the safer and lower risk the trade. If they don't agree. look for the larger trend and levels to show you the way. it is a part of trading to be able to trade into a possible level and then turn to join a trend in progress. but this is much easier to do if your looking at a trade off a fast chart looking to TP at a counter level on a larger chart,

Some find this as a great way to trade others tend to just like to wait for the longer time frame charts to take there trades off. if you have a hard time changing your bias idea. Then maybe trading against a major trend is not for you . So pick your levels off the higher charts and wait for the fill.

Once your picks are solid that requires a lot less screen time.
Good Trading To All ; Ken Lee
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