VasilyTrader

Your ULTIMATE Guide For Time Frames in Trading

Education
OANDA:XAUUSD   Gold Spot / U.S. Dollar

If you just started trading, you are probably wondering what time frames to trade. In the today's post, I will reveal the difference between mainstream time frames like daily, 4h, 1h, 15m.

Firstly, you should know that the selection of a time frame primarily depends on your goals in trading.

If you are interested in swing trading strategies, of course, you should concentrate on higher time frames analysis while for scalping the main focus should be on lower time frames.


Daily time frame shows a bigger picture.
It can be applied for the analysis of a price action for the last weeks, months, and even years.
It reveals the historical key levels that can be relevant for swing traders, day traders and scalpers.
The patterns that are formed on a daily time frame may predict long-term movements.


In the picture above, you can see how the daily time frame can show the price action for the last years, months and weeks.

In contrast, hourly time frame reflects intraweek & intraday perspectives.

The patterns and key levels that are spotted there, will be important for day traders and scalpers.
The setups that are spotted on an hourly time frame, will be useful for predicting the intraday moves and occasionally the moves within a trading week.


Take a look at the 2 charts above, the hourly time frame perfectly shows the market moves within a week and within a single day.

4H time frame is somewhere in between. For both swing trader and day trader, it may provide some useful confirmations.
4H t.f shows intraweek and week to week perspectives.


Above, you can see how nicely 4H time frame shows the price action on EURUSD within a week and for the last several weeks.

15 minutes time frame is a scalping time frame.

The setups and levels that are spotted there can be used to predict the market moves within hours or within a trading session.


Check the charts above: 15 minutes time frame shows both the price action within a London session and the price action for the last couple of hours.

It is also critical to mention, that lower is the time frame, lower is the accuracy of the patterns and lower is the strength of key levels that are identified there. It makes higher time frame analysis more simple and reliable.

The thing is that higher is the time frame, more important it is for the market participants.

While lower time frames can help to predict short term moves, higher time frames are aimed for predicting long-term trends.


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