Thursday, January 14, 2010

Highest certainty at the smallest time frame

How certain are you that the market will move in the direction you want and stay exactly the way you want it? I bet not many experience it all the time as expected and it might annoys you more if the market make an immediate reverse to the opposite direction by the time you want to close your position.

For example you like to trade at 4 hourly and daily time frame. Everyday you expected the market will move in your expectation direction and achieve the target profit as set by you. Unfortunately this good things doesn't happen in forex. The high volatility of the market is very disturbing. Sometimes the market reach at certain point and reverses more than expected or else it might move the other direction from your expectation.

So how to tackle this dilemma is by playing the 5 minutes candle by candle. By using short-term time frame you will get the profit quickly without waiting every 4 hourly or 1 day. This also to anticipate any reverse in direction that might exceed the amount of gain within a long day of trading. Nobody knows what happen in between the days or every hours because so many factors that affecting the market making it so difficult to determine the unexpected to happen. Among the factors that can disrupt the market is currency correlation, news release, indicators setting differences, long-term trader strategies and so on.

By applying short-term time frame trading you are eliminating the doubts and your losses also very limited to 5 minutes candle movement.

Hope this will help
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