The time frame is the unit of time from which the trader must study the trend and perform a technical analysis. This unit of time plays an essential role in establishing a good trading strategy. Especially in Forex and CFDs, it is essential to choose the right time frame before opening an investment, thus optimizing the chances of success. Discover how to proceed properly... Understand
and exploit the time frame displayed
on brokers’ graphs, the time frame is the unit of time on which the timing of the investment must be based. It is used to study trends within trends, since the latter include micro trends that will then serve as indicators for analysis. In order to understand price movements, it is therefore essential to take into account the different time frames and to consider these periods within the trends. The choice of time frame depends essentially on the life span of the positions, as well as the asset in question and its speed of evolution. choose the time
frame according to the trading mode There are
several categories of time frame that can be used on Forex and CFD:
- For the scalper
The scalper works on a very short time unit, which can reach up to 1 minute. It plays on micro-variations. During a day, he can take several positions and thus expects low but numerous profits. Decisions are made quickly and, unfortunately, this technique is quite dangerous on Forex and CFDs. Such a short time frame is especially dedicated to experts.
- For the day trader
Slower than the scalper, but always playing in the short term, the daytrader must use an average time frame. This is the most common unit of time on Forex, which can be 5, 15, 30 or even 60 minutes. The day trader does not juggle too many signals, but must be very responsive during the day. Its time frame is the most recommended for those who are new to Forex.
- For the swing trader
The swingtrader, on the other hand, focuses mainly on the medium term and prefers to think carefully before opening a position. He uses more distant signals, from one hour to one day, which allow him to reduce the risk of false positives and make conscious decisions. Its time frame is not based on micro trends, but on daily evolutions.
- For the trader position
And then, for the trader position, which is mainly an investor in equities, the time frame used is much longer. This can vary from one day to several months. In any case, the most important thing is to establish your objectives and choose the most appropriate time frame. In addition, each trader must ensure that he remains faithful to his initial strategy