Chart Intervals

Hi,

I'm a newbe (been trading Forex for over a year, but I'm still very green)

and one thing really baffles me. Time Intervals. You look at the 4 hour and it’s in an uptrend, you look at the 1 hour and it's in a down trend, you look at the 5 min and it's ranging.



Which time frame is the most accurate. Say you decide that you want to be in a trade for a week, which chart you would rely on to be must accurate.


Thank you

The larger the time frame, the more stable the trend is. The smaller the time frame the more noise there. Most newer traders want to trade the very fast times like 5 and 15 minute. But, there is so much noise, you can get wipsawed to death. By picking a trading method based on a 4hour or longer time frame you have time to think about planning your trades, the entries the exits and the stops...

Scott

All of them. And More, you should include longer timeframes also. It doesn't matter how long you Hope or Expect to be in the trade. Look at {better yet, Know} all of them before you enter.

Think of it as looking at {say} a Daily Chart where each bar gives you an overall picture of what happened over the previous 24 hour period.
Let's say the last candle is bullish {filled} but the close is only half way up the candle. That, in itself, doesn't tell you much.

It depends on how it got to that close. Did it collapse off the top in a free fall or claw it's way back up off the bottom. And while you are looking at the Daily take note of how it relates to the previous candles. {do this with all timeframes}

Then take that chart & put it under the microscope to "Zoom In" so to speak by looking at a 4 Hour Chart. It will give you a better clue whether it Fell or Climbed to the close.

But the last candle on the 4 Hour may also have Closed half way up the candle. So, turn your microscope to a larger magnification and look at a 2 Hour. >and so on > and so on >

Use Shorter Timeframe Charts to assist you in timing your entry/Exit.
Use Longer Timeframe Charts to assist you in determining underlying Strength/Weakness

Thank you all

alan farley call this "trend relativity error"....its the fact, that the same market can be on opposing trends on different timeframes...there are 2 ways to deal with this

1. treat each timeframe as a separate market

that is, you analyse and trade only ONE timeframe. period.

2. make "multiple timeframe analysis"

that is, you analyse different timeframes of the same market as a filter to trade on your choosen timeframe in the following way..

quote buffy:

"While you may trade the trends on the smaller time frame, waiting for price action to show it is going to move in the same direction as the larger time frame is trading with the trend. "