Where are the benefits hidden? I think they were hiding somewhere between the 5-minute bar chart and the daily chart. One of the Forex topics I often talk about is why new traders should only trade with longer time frames. I consider a time frame a graph of 4 hours or more. I mainly trade with the daily bar chart because I like to have a wide view of the forex market without the noise of the smaller time frames. It seems to me that this makes my decision process easier.
What a noise? I said that noise is one of the reasons why I don’t operate with smaller time frames. Noise, for me, are the constant waves and waves that make the price action of an exchange rate rise and fall. Sure, this can give you a lot of opportunities to place trades, but what I’ve discovered is that the more tradespeople place in these smaller time frames, the more money they lose.
Most retail traders simply don’t have the skill to pick enough winning trades and make it profitable, and they don’t have a system to keep them out of a bad trade either.
The real reason I love daily chart trading.
Yes, the daily chart indeed has less noise, but best of all, you don’t have to check it as often. Trading daily bars do not require you to sit in front of a computer all day to watch the currency market rise and fall. Now that I only look at the daily chart, I check every exchange rate I trade with once a day. I place my trades and I’m done. I have an application that allows me to track my operations but even so I consult it in moderation.
I love the freedom that this type of trading gives me. The funny thing is that you can do these types of intraday trades on the daily chart. For example, it would not be uncommon to see me place a trade “chasing” 50 points or more when I see a trigger pattern on my forex chart. I will also sometimes trade following a trend that looks like it will continue with this kind of intraday approach. By intraday, I mean that I am going to close this position or try to reach my goal within 24 hours.
So where are the benefits?
They appear to be hidden in larger time frames, such as daily bar graphs. As you can see, my method tries to simplify things. I want to do as few operations as possible, I want to fix them and forget about them. Once I place an operation, I let it run its course. I don’t alter or add anything to it. I don’t make a decision once I’ve clicked buy or sell.
Now let’s see real results of a real student
I want you to look for a moment at the results that this student has obtained in a short time using my methodology …
When I accept someone in my trading program, I demand an absolute commitment when sending me their operations every weekend, with screenshots of them and it is also essential that I keep a very accurate record of the operations carried out during that week. What is not measured and analyzed cannot be improved! So if you are not keeping a detailed record of your entries and you do not have a trader who is already achieving consistent results as a mentor, you will be wasting time-fighting alone against the markets. Trust me.
That being said, now look at the results of tickets that last a day (marked in red) compared to those that open and close the same day. You can choose to get € 206.59 profit or € 270.66 but you are going in and out several times a day. I prefer to do 2 trades on a higher chart because this allows me to be with my family longer, not to depend on being in front of the monitors all the time and at the same time I do more calm trading. Do you agree?
Let’s go to see the graphics … Now look at this:
In this graph, each candle represents 1 hour. This means that decision making is every hour (and not every 3, 5, or 10 minutes as almost all traders do). With the method, I teach there is no room for interpretation and nothing is subjective. Everything is 100% objective. The moment this trade made the entry, you placed your stop and you can forget a few hours.
Notice that 7 hours later it is positive … Wouldn’t you rather look at a graph every 5 or 7 hours than every 2 or 3 minutes? How would your trading change if you made decisions every hour? Would you be more stressed in front of your computer and would you be much calmer? Would you have more time to spend on other things you would like to do? Answer these questions mentally …
Let’s see what the trader did….
8 hours later this trader student closes his partial position! Do you notice the difference between continuously going in and out on a 3 or 5-minute chart vs. an hourly chart?
The advantages of migrating to superior graphics are obvious, as you have already seen.
Of course, you have to have a 100% objective methodology and money management rules that allow you to maximize results. That is what I teach step-by-step to those who are part of my Coaching Program in Trading!