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  1. #1
    Rookie Member

    How to look at timeframes !!!

    When I have time I try to read as much as possible. Sometimes I download books and something nice pops along.

    Now I have a book which is about RSI. Not the so called "unbeatable strategy" book, but a book that seriously is about the indicator in relation to the market.

    Nowe before smashing down the author, please note that I might misinterpreted the following, and if so please smash my dreams.

    It's about looking at time frames. What I understood in the text is the following.

    If you look at different time frames the likelihood that more capitalised investors will be trading with longer time frames in their mind.

    Then it comes down to this, let's say I look at a timeframe of a minute and I see a bullish trend or candle it's wise to look at longer time frames whether it is actually taken over by better capitalised investors which increases the change that indeed the trend will be bullish and not a short peak. Of course this is not a golden rule but it could be helpful to understand the movement of the markets.

    Of course you should always look at longer time frames before making a trade, but looking it with in mind the fact that more capitalised investors will use longer time frames adds to the understanding of how the price could move.

    And again, please don't blame the author it could be my misinterpretation. If so, please smash my dreams.

    But let's say there is something to say for it, what I ask myself then is this pure stock related or could it also apply to the forex markets, of course not as a golden rule, but just a good indication. Because I can also imagine that it could apply to stocks but less to forex markets?

    Please note, I am still a bit busy now, so if I answer a little late it is because of this, and not lack of interest in your answer. I would like to know what experienced traders think of this.
    Last edited by mrb71; 01-02-2017 at 10:15 PM.

  2. #2
    Veteran Member Ronnel's Avatar
    Quote Originally Posted by mrb71 View Post
    When I have time I try to read as much as possible. Sometimes I download books and something nice pops along.

    Now I have a book which is about RSI. Not the so called "unbeatable strategy" book, but a book that seriously is about the indicator in relation to the market.

    Nowe before smashing down the author, please note that I might misinterpreted the following, and if so please smash my dreams.

    It's about looking at time frames. What I understood in the text is the following.

    If you look at different time frames the likelihood that more capitalised investors will be trading with longer time frames in their mind.

    Then it comes down to this, let's say I look at a timeframe of a minute and I see a bullish trend or candle it's wise to look at longer time frames whether it is actually taken over by better capitalised investors which increases the change that indeed the trend will be bullish and not a short peak. Of course this is not a golden rule but it could be helpful to understand the movement of the markets.

    Of course you should always look at longer time frames before making a trade, but looking it with in mind the fact that more capitalised investors will use longer time frames adds to the understanding of how the price could move.

    And again, please don't blame the author it could be my misinterpretation. If so, please smash my dreams.

    But let's say there is something to say for it, what I ask myself then is this pure stock related or could it also apply to the forex markets, of course not as a golden rule, but just a good indication. Because I can also imagine that it could apply to stocks but less to forex markets?

    Please note, I am still a bit busy now, so if I answer a little late it is because of this, and not lack of interest in your answer. I would like to know what experienced traders think of this.

    This is just my opinion that charting is the same whether it be Forex, CFDs, Stocks or Binary Option, etc. Looking at TF too is basically the same.

    It said "Of course you should always look at longer time frames before making a trade, but looking it with in mind the fact that more capitalised investors will use longer time frames adds to the understanding of how the price could move" but my answer is depending on one's entry and exit/expiry target. For me, it can be a month long bullish trend but if one is using say M5 chart and he is only doing day trades, that monthly TF chart won't really mean much to the day trader especially if he is trying reversals. A day chart will be very much useless to a speed scalper doing 30 sec, or M1... What I'm trying to say is using the proper chart for a certain purpose is more vital than just looking at a higher TF.

    This will sound weird but I'll share this with you. I do know how to use multiple TF and there was a time that I looked at higher TF chart too but now I only use one chart for everything. Yes for a less skilled chartist, looking at a higher TF chart is a lot easier than using only one especially on a lower TF. For me one of my favourite TF to use is M5. People may think that since I'm only using M5 that I cannot see H1 on my M5 chart which is very much wrong. Actually I can see more than that because I was trained to read charts this way. I can even use M1 to enter longer trades without problems. The secret is to count candles and use proper trendlines. For example: on a M5 chart, 1 hour = 12 candles. So if I want to see H1 using M5 chart that all I have to do is count 12 candles going backwards. On a H1 the candle is bearish but if you look at M5 you'll definitely see those 12 candles formed a bearish pattern. So even if I'm using M1, I can use it to calculate for H1 or even longer by just counting candles and looking at the pattens formed by price. Yes this is not newbie friendly and only a few very advance traders even use this because it's just easier to click the mouse to a higher TF than to do all the calculation that I mentioned. Also many say that looking at a higher TF shows stronger S/R but if one knows how to properly chart his puny-little chart also will reveal strong S/R but to do this one needs more charting skills (and more brain cells) than just by easily clicking the mouse and jumping on a higher TF.

    So why am I using only one TF if it needs that much work and is so complicated??? My answer is "because it's awesome for speed-trading multiple pairs all at once" and since I have been doing it everyday that my eyes just go automatic and I really don't need to count candles anymore nor need to plot trendiness just to see the trend. If you spent lots and lots of hours watching candles that it becomes automatic to see different TF and detect different kinds of trend in just a glance. This is old-school charting technique and maybe you have heard of the "atleast 10000 hours naked charting time" and this is one of the fruits that comes out doing it

    I'm not smashing down your dream or anything and I'm supporting what you wrote because I do look at longer TF using my single chart. The only thing is that I don't literally click my mouse to jump from one TF to another because I really don't need to because my chart basically shows me everything. It's just a matter of how one is using it.

    By the way, please don't start using only one chart for everything if you are not ready and not comfortable doing it because it needs lots of TLC (tender loving care) or it bites, lol!
    Anyway, this is just my humble opinion...
    Duct Tape can't fix OTM

  3. #3
    Legendry Member Michael Hodges's Avatar
    time frames are important. You don't want to trade short term calls when the long term signal is bearish, you want to look at bearish positions because they are more likely to win. The key is to use the longer term to set a direction in which you want to trade, immediately cutting out 50% of the potential signals that could be generated, and then use other analysis and indicators to cut out more false signals until you find the ones that are the most profitable.

  4. #4
    Legendry Member milos's Avatar
    Quote Originally Posted by mrb71 View Post
    When I have time I try to read as much as possible. Sometimes I download books and something nice pops along.

    Now I have a book which is about RSI. Not the so called "unbeatable strategy" book, but a book that seriously is about the indicator in relation to the market.

    Nowe before smashing down the author, please note that I might misinterpreted the following, and if so please smash my dreams.

    It's about looking at time frames. What I understood in the text is the following.

    If you look at different time frames the likelihood that more capitalised investors will be trading with longer time frames in their mind.

    Then it comes down to this, let's say I look at a timeframe of a minute and I see a bullish trend or candle it's wise to look at longer time frames whether it is actually taken over by better capitalised investors which increases the change that indeed the trend will be bullish and not a short peak. Of course this is not a golden rule but it could be helpful to understand the movement of the markets.

    Of course you should always look at longer time frames before making a trade, but looking it with in mind the fact that more capitalised investors will use longer time frames adds to the understanding of how the price could move.

    And again, please don't blame the author it could be my misinterpretation. If so, please smash my dreams.

    But let's say there is something to say for it, what I ask myself then is this pure stock related or could it also apply to the forex markets, of course not as a golden rule, but just a good indication. Because I can also imagine that it could apply to stocks but less to forex markets?

    Please note, I am still a bit busy now, so if I answer a little late it is because of this, and not lack of interest in your answer. I would like to know what experienced traders think of this.
    https://www.youtube.com/watch?v=800soEvoxpM

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