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Tuesday, July 17, 2012

Forex school 151 Time Frame Combinations


Time Frame Combinations

Man with multiple time frame disorder
Here at the BabyPips.com School of Pipsology, we like using three time frames. We feel that this gives us the most flexibility, as we can decipher the long, medium and short term trends.
The largest time frame we consider our main trend - this shows us the big picture of the pair we wanna trade.
The next time frame down is what we normally look at, and it signals to us the medium term buy or selling bias.
The smallest time frame shows the short term trend and helps us find really good entry and exit points.
You can use any time frame you like as long as there is enough time difference between them to see a difference in their movement.
You might use:
  • 1-minute, 5-minute, and 30-minute
  • 5-minute, 30-minute, and 4-hour
  • 15-minute, 1-hour, and 4-hour
  • 1-hour, 4-hour, and daily
  • 4-hour, daily, and weekly and so on.
When you're trying to decide how much time in between charts, just make sure there is enough difference for the smaller time frame to move back and forth without every move reflecting in the larger time frame.
If the time frames are too close, you won't be able to tell the difference, which would be pretty useless.

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