Define Your Time Frame

Define Your Time Frame explained by professional Forex trading experts the “ForexSQ” FX trading team.

Define Your Time Frame

The time frame you choose to trade should fit your personality. If you don’t have time to watch the markets all day long and need more time to analyze each trade then you are a natural long term trader.

The time frame of your charts should be either daily or even weekly. In this way you will make fewer transactions and pay the spread less often. Since your system will issue only a few signals each month or year, you will have to be patient. Long term trades require bigger stops, so a bigger account is needed if you don’t want to receive margin calls.

On the other hand, if you are impatient, you spend most of your time watching the screen and you feel the urge to press the button, a long term time frame is not for you. Instead you should be an intraday trader using 15-minute or even 1-minute charts.

In this way you will have many trading opportunities every day and you will avoid overnight risks. However, you will pay the spread more often and you will need more stamina to remain focused and frequently change biases.

Somewhere in the middle are the swing traders, who use hourly charts to execute short term trades that last for several hours or even days.