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Preferred Timeframe for Trading

  • #41
  • Sep 20, 2014 9:10am Sep 20, 2014 9:10am
all said...nothing new or revolutionary...charts are like shopping windows. Find your TF to get best of your shopping.
The Market pays you to be disciplined
  • #42
  • Sep 20, 2014 9:18am Sep 20, 2014 9:18am
Quoting mima
all said...nothing new or revolutionary...charts are like shopping windows. Find your TF to get best of your shopping.
Yes but i`m not asking about timeframes in general, but rather why did each individual trader choose them, what made them choose the TF they choose and which one is it.

Those 2 questions are the main topic of this thread as stated in post #1.

Mostly interested in the logic behind the choice, as i see many of the traders cram together in the H4, but why is that, if no TF is has any difference between them, which is not true but lets suppose it is, still doesnt explain why H4 traders are more than H1 traders for example.

If all TF would be the same, then every timeframe would have approximately equal amounts of traders, so this is not the case, H4 traders must have a very good reason behind it.

The question is what is that?
"There's a sucker born every minute" - P.T. Barnum
  • #43
  • Sep 20, 2014 12:49pm Sep 20, 2014 12:49pm
your question is meaningless, especially if you agree that each timeframe provides different information.

in other words, not a single TF is capable of delivering all information. normally a profitable method/system need to consider multi-timeframe.
  • #44
  • Sep 20, 2014 2:34pm Sep 20, 2014 2:34pm
Quoting charvo
your question is meaningless, especially if you agree that each timeframe provides different information. in other words, not a single TF is capable of delivering all information. normally a profitable method/system need to consider multi-timeframe.
Perhaps but you still need to define a timeframe, by looking at M5->D1 you actually looking at D1 but zoomed in.

You have to define the period which is the maximum that you look back too.

Or in other words how much you need to look back into the past to forecast the future?
"There's a sucker born every minute" - P.T. Barnum
  • #45
  • Edited 4:35pm Sep 20, 2014 3:57pm | Edited 4:35pm
Quoting Proximus
{quote} Yes but i`m not asking about timeframes in general, but rather why did each individual trader choose them, what made them choose the TF they choose and which one is it....

I change all timeframes: m1 to MN...to figure out market makers intention ..there is no logic...it is personal filling of each trader...

I am surprised you opened thread for such things...disappointed.
The Market pays you to be disciplined
  • #46
  • Sep 20, 2014 4:22pm Sep 20, 2014 4:22pm
Quoting Proximus
{quote} Thats not true, not even the distribution of the real movement is the same between all TF because HFT generated price moves are totally different than those from large investors planning on Quarterly trades. And also the noise whatever distribution it may have, the size of the noise itself is much smaller on high timeframes. In basic terms, the price makes smooth and big swings on high timeframes, and choppy consolidated moves on low TF.
Pay close attention to what he just wrote here. HFT's and the likes can spike a 1 hour candle and below and under easy, go and look up any chart you want. 4H and up....yeah right, That's very hard to do Most will never have enough money to do it or simply want to take the risk because of the ATR those candles have. Even banks wouldn't attempt it. govt ....MAYBE...BIG maybe
  • #47
  • Sep 20, 2014 6:21pm Sep 20, 2014 6:21pm
Quoting mima
{quote}I am surprised you opened thread for such things...disappointed.
Did you ever considered that other people read this thread too, if we know that, doesnt mean that others know it too, let other peoples learn too, nobody starts as a pro.
"There's a sucker born every minute" - P.T. Barnum
  • #48
  • Sep 20, 2014 9:05pm Sep 20, 2014 9:05pm
I personally only trade two systems depending on the time of the day. European/US opens I use the 70 tick chart. If I am trading the Asian session I normally use the 5m chart and just trade PA in the direction of the 4h trend, but will still leave the 70 tick chart up might get one trade a night if your watching close on the Asian on the 70 tick.
~ Stay Green
  • #49
  • Sep 20, 2014 10:16pm Sep 20, 2014 10:16pm
if a rigid system, how long back to consider may be really defined. but different profitable system of coz has different consideration, again you cannot derive significant tip from people's vote.

on the other hand, the ultimate way to take the market will absolutely knows how to deal with a market 10 yrs old as well as 3 days old. i guess what i'm to say is the method/thinking process is the key instead of the timeframe or how long you look back.

Quoting Proximus
{quote} Perhaps but you still need to define a timeframe, by looking at M5->D1 you actually looking at D1 but zoomed in. You have to define the period which is the maximum that you look back too. Or in other words how much you need to look back into the past to forecast the future?
  • #50
  • Edited 11:48pm Sep 20, 2014 11:22pm | Edited 11:48pm
Quoting Proximus
Anyone else wants to share his thoughts about timeframes?
I do.

1. Not all time frames are for trading (placing orders). They are just like countries. Some countries are good for honeymoon, some are good to escape from IRS, some are good to hide from your mother(s) in law, some are good to have your throat slit, but there is only one or two countries that you select to reside.

2. Not all time frames are there to get a direction all the time. Smaller time frames (1m, 5m, 15m, 1h) are very good to observe reaction to a news event. It gives you an idea what market is trying to do. But purpose of such observation is not to trade these small movements with obnoxious variable spreads. You never know when spread gets wider than both your TP and SL. What happens on a smaller time frame should be viewed in context of a bigger time frame.

3. Not all time frames provide good indication all the time. Study of smaller time frames to see what pa does on open or close of a session provides a hint what are the sentiments of those regions or market segments. Study of 15M or 1H during a session provides an indication of what this session is trying to do. Yet again, there is a session open, session close, active session time, dull session time, etc. You study movements during these times to grasp what this particular session is up to and what will be its effect on the next session.

4. Not all trading methods are designed to operate in one particular time frame. Different trading methods and different trading strategies use different time frames.

Conclusion: Almost all time frames have their uses, no matter what time frame one is using to trade. Therefore, all time frames should be the preferred time frames of a trader. Yes, there are preferred time frames only because they suite a trading method.

Was it helpful?
a) Yes
b) No
c) Somewhat
d) I don't know
e) GFY
The Thief of Wall Street
  • #51
  • Sep 20, 2014 11:47pm Sep 20, 2014 11:47pm
Quoting Proximus
Is there anyone else who wants to share their opinion about timeframes? C'mon guys i really want to keep this thread rolling so please dont be shy and share your opinion, thanks!
Entry for 1 hour exit for 15 min
Neural Network Algorithm and Econophysics
  • #52
  • Sep 21, 2014 1:24am Sep 21, 2014 1:24am
Greetings, Firstly the responses and sheer nature of the question cast a pejorative light on the mathematical capabilities of the sample populous. Picking time-frames should not be a choice all time frames should be factored into a successful strategy. For example there was mention of acceleration and volatility. In order to represent either one of the metrics or measures one would have the have a baseline to illustrate acceleration. Similarly establishing a currency or time frame as volatile there would have to be a homeostatic normalcy to measure against. Fractals were also mentioned, a term that has been thrown around erroneously on the forums and message boards for quite some time. The word "fractal" often has different connotations for laypeople than for mathematicians, where the layperson is more likely to be familiar with fractal art than a mathematical conception. The mathematical concept is difficult to define formally even for mathematicians, but key features can be understood with little mathematical background. The feature of "self-similarity", for instance, is easily understood by analogy to zooming in with a lens or other device that zooms in on digital images to uncover finer, previously invisible, new structure. If this is done on fractals, however, no new detail appears; nothing changes and the same pattern repeats over and over, or for some fractals, nearly the same pattern reappears over and over. Self-similarity itself is not necessarily counter-intuitive (e.g., people have pondered self-similarity informally such as in the infinite regress in parallel mirrors or the homunculus, the little man inside the head of the little man inside the head...). The difference for fractals is that the pattern reproduced must be detailed.


According to Falconer, rather than being strictly defined, fractals should, in addition to being nowhere differentiable and able to have a fractal dimension, be generally characterized by a gestalt of the following features;

Self-similarity, which may be manifested as:
Exact self-similarity: identical at all scales; e.g. Koch snowflake
Quasi self-similarity: approximates the same pattern at different scales; may contain small copies of the entire fractal in distorted and degenerate forms; e.g., the Mandelbrot set's satellites are approximations of the entire set, but not exact copies.
Statistical self-similarity: repeats a pattern stochastically so numerical or statistical measures are preserved across scales; e.g., randomly generated fractals; the well-known example of the coastline of Britain, for which one would not expect to find a segment scaled and repeated as neatly as the repeated unit that defines, for example, the Koch snowflake
Qualitative self-similarity: as in a time series
Multi-fractal scaling: characterized by more than one fractal dimension or scaling rule
Fine or detailed structure at arbitrarily small scales. A consequence of this structure is fractals may have emergent properties (related to the next criterion in this list).
Irregularity locally and globally that is not easily described in traditional Euclidean geometric language. For images of fractal patterns, this has been expressed by phrases such as "smoothly piling up surfaces" and "swirls upon swirls".

In order to establish trading on any time frame all time frames must be accepted for their influence and make up of the other time frames. The erroneous homogenizing of days of the market and the time frames leads to what people call spikes or anomalies. If one were to ignore the intrinsic properties of the first Friday of every month it would seem like an anomaly. However if you take the first Friday of every month and examine these together as its on group then actually volatility can be represented if there was some form of deviation.

The 7 averages every trader must know of the currency pair they intend to trade:

1. Average Daily Movement - All Days
2. Average Day of Week Movement - e.g. All Mondays
3. Average Day of Month - e.g. All Days in June
4. Average Day of Week in Month - e.g. All Mondays in June
5. Average Day Specified week in Month - all days in the first week of the month
6. Average Day of week Specified Week in Month - all Mondays in the first week of the month
7. Average Day of week Specified Week in Specified Month - All Mondays in the first week of June

How will this help you? you now have a range of movement for your specific pair, bringing in the standard deviation and the coefficient of variance you can find the most likely range of movement. With this information you will know how far a pair has left to travel which often times prompts a reversal by the pair once that distance is reached. This is a good start for anyone truly attempting to trade with a successful strategy.
  • #53
  • Sep 21, 2014 5:51am Sep 21, 2014 5:51am
Think of timeframes as a perspective view, similar to looking down a microscope to get a closer look.
You are still looking at the same thing but with more detail.

How much magnification you require will be down to the perspective that you personally want to view.
It never gets easier, you just get better
  • #54
  • Sep 21, 2014 11:30am Sep 21, 2014 11:30am
Quoting Chicky
{quote} I do. 1. Not all time frames are for trading (placing orders). They are just like countries. Some countries are good for honeymoon, some are good to escape from IRS, some are good to hide from your mother(s) in law, some are good to have your throat slit, but there is only one or two countries that you select to reside. 2. Not all time frames are there to get a direction all the time. Smaller time frames (1m, 5m, 15m, 1h) are very good to observe reaction to a news event. It gives you an idea what market is trying to do. But purpose of such...
If a trader knows what he is doing then he will probably, sooner or later, find the best period suitable for him.

If the strategy he is using, and he already has settled the time horizon of his trades, are matched with the TF of his choice then its good.

But perhaps i wanted to know why X trader chooses Y timeframe, particularly.So as if why scalping > swing trading or vice versa, if the majority wants to scalp then why M15 instead on M5 for example.

Because there is a clear tendency towards, larger timeframes, but not that large, so looks like the majority of traders found the balance between SPEED & ACCURACY at the H4 timeframe.

And its a mistery why that TF got choosed.Is it the herd effect or does H4 smooth price better?

Some would say both.
"There's a sucker born every minute" - P.T. Barnum
  • #55
  • Sep 21, 2014 11:48am Sep 21, 2014 11:48am
Quoting DXanatos
Greetings, Firstly the responses and sheer nature of the question cast a pejorative light on the mathematical capabilities of the sample populous. Picking time-frames should not be a choice all time frames should be factored into a successful strategy. For example there was mention of acceleration and volatility. In order to represent either one of the metrics or measures one would have the have a baseline to illustrate acceleration. Similarly establishing a currency or time frame as volatile there would have to be a homeostatic normalcy to measure...
Informative post, thanks for explaining the difference between fractal art and mathematical fractals.It is a very nice post, thanks for contribution.

However this is my opinion: The problem with your last paragraph where you talk about the measurement of SD and the coefficienct of the variance is probably beyond layman understanding of the FX market.I`m not trying to be disrespectful towards the average trader, but quantitative trading is very hard to grasp for an average trader.

I recognized the fractal nature of the market since day 1 of my trading adventures, the problem is not to recognize it but to exploit it.The SD is very very hard to measure on the market.All traders who use Bollinger Bands, pretty much know that the BB doesnt measure the SD correctly.

The first problem with these retail indicators is that its constructed on normal distributed data, which the market is not,which is only a tiny error but the biggest problem is that the second one which is that it doesnt measure the mean correctly.The mean is very hard to measure in a heteroscedastic market like FX.

Here i have a thread where i`m trying to measure it: http://www.forexfactory.com/showthre...51#post7752051

If one could precisely measure the SD correctly then it would be the holy grail, because you just need to put the SL outside lets say 3 deviations and profit, but unfortunately the market is a very tricky thing.

The problem is not with the fractal nature, i could care less about the fractal nature of it, but with the ever changing distribution, the heteroscedasticity of it.

Also, the timeframe itself its not really meant to be a sampler for the SD function, but rather to smooth price to ignore anomalies like the spikes, because they are just unexpected, so why bother forecasting them ? The SL itself should protect us from it, there is no need to do anything about them.
"There's a sucker born every minute" - P.T. Barnum
  • #56
  • Sep 21, 2014 11:53am Sep 21, 2014 11:53am
Quoting Proximus
the majority of traders found the balance between SPEED & ACCURACY at the H4 timeframe. And its a mistery why that TF got choosed.Is it the herd effect or does H4 smooth price better? Some would say both.
http://www.forexfactory.com/showthread.php?t=336715
No greed. No fear. Just maths.
  • #57
  • Sep 21, 2014 11:57am Sep 21, 2014 11:57am
Quoting Proximus
{quote} The problem is not with the fractal nature, i could care less about the fractal nature of it, but with the ever changing distribution, the heteroscedasticity of it. Also, the timeframe itself its not really meant to be a sampler for the SD function, but rather to smooth price to ignore anomalies like the spikes, because they are just unexpected, so why bother forecasting them ? The SL itself should protect us from it, there is no need to do anything about them.
If something in math is ever changing then you are not taking the base calculations properly. Let's take this example: If I place the offer to Mr. Proximus that there are 2 conference rooms with 20 men in each room. The average height in conference room A is 6ft tall. The average height in conference room B is 6ft tall. If I send you in the room blind-folded with the task of coming out with a man that measures 6ft in height to win 1 million dollars. Do you feel you are equipped with enough information to make a sound decision?
  • #58
  • Sep 21, 2014 12:01pm Sep 21, 2014 12:01pm
Quoting PipMeUp
{quote} http://www.forexfactory.com/showthread.php?t=336715
I knew about that thread for a while , but i dont think that every single trader on this forum read his thread, in fact most of them havent considering that it has only 16 posts instead of like 50.000 like other threads do.

So clearly the majority of traders have other logic behind their choice.

Also i found another thread where one guy argues that the optimum TF is ever changing on a random interval basis.He measured it on a week by week basis, also with the mutual information method, and sometimes he found M3, then M10 and other intervals to be the best ratio between signal & noise.

I find it very hard to believe that there are absolutes in the FX market, its is very relativistic and every changing.
"There's a sucker born every minute" - P.T. Barnum
  • #59
  • Sep 21, 2014 12:10pm Sep 21, 2014 12:10pm
Quoting DXanatos
{quote} If something in math is ever changing then you are not taking the base calculations properly. Let's take this example: If I place the offer to Mr. Proximus that there are 2 conference rooms with 20 men in each room. The average height in conference room A is 6ft tall. The average height in conference room B is 6ft tall. If I send you in the room blind-folded with the task of coming out with a man that measures 6ft in height to win 1 million dollars. Do you feel you are equipped with enough information to make a sound decision?
Yes indeed, that is the problem, because there is 1 formula for the MEAN of the market which is measuring it perfectly, the problem is that it is unknown.Heck i believe there is a formula that can measure anything with some degree of certainty, there is none that can eliminate uncertianty completely, but there should be one which is the most optimal.

So with the markets, there is a formula that can predict X+1 bars ahead always, the problem is that nobody knows it, if you knew it then you would be a billionaire and make sure that nobody else would know it.If someone else would find it out then it would render it obsolete and you'd have to find another one.

Every quant makes himself a Neural Network, a very very complex one, and tries to predict the market, but he always faces the problem the correct sample size and the periods of optimization.

It was when the first person invented the correct formula which could approximate pi, i bet he tried millions of other formulas before he found the correct one, the same is with price.

The unknown is always the biggest mistery isnt it?
"There's a sucker born every minute" - P.T. Barnum
  • #60
  • Sep 21, 2014 1:29pm Sep 21, 2014 1:29pm
Quoting DXanatos
{quote} If something in math is ever changing then you are not taking the base calculations properly. Let's take this example: If I place the offer to Mr. Proximus that there are 2 conference rooms with 20 men in each room. The average height in conference room A is 6ft tall. The average height in conference room B is 6ft tall. If I send you in the room blind-folded with the task of coming out with a man that measures 6ft in height to win 1 million dollars. Do you feel you are equipped with enough information to make a sound decision?
Since 6ft is an average perhaps none of them is 6ft tall. But the main piece of information is that Mr Proximus loses nothing by trying. So he can randomly pick anybody. Or he can walk in the room and say "Hey the 6ft guy come with me!". You didn't say he shall not speak.

Quoting Proximus
i dont think that every single trader on this forum read his thread, in fact most of them havent considering that it has only 16 posts instead of like 50.000 like other threads do. So clearly the majority of traders have other logic behind their choice.
I never said anybody had read his thread. Just that a lot of traders trying randomly all the possible timeframes will converge towards the optimal by trail and error. Call it Darwinism if you like.

Quoting Proximus
{quote} Yes indeed, that is the problem, because there is 1 formula for the MEAN of the market which is measuring it perfectly, the problem is that it is unknown.Heck i believe there is a formula that can measure anything with some degree of certainty, there is none that can eliminate uncertianty completely, but there should be one which is the most optimal. So with the markets, there is a formula that can predict X+1 bars ahead always, the problem is that nobody knows it, if you knew it then you would be a billionaire and make sure that nobody...
I find you cast a lot of your own believes onto other people. Personally I never used a NN. Especially not a "very very complex one" which would be the best way to overfit any data. I don't know for the others but I don't try to predict any bar and I don't optimize parameters. Egyptian certainly used rational reasoning to approximate π like Babylonians and Greeks after them did. They didn't pick random formulas.
No greed. No fear. Just maths.
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