Most forex traders don't know how or why the foreign exchange price moves, and make critical mistakes in the trading time frame. In this article, we'll look at three popular timeframes and determine which is the best timeframe for trading in your trading strategy.
In the foreign exchange market, all fundamental supply and demand news will be displayed in the price trend, and all traders' opinions will also be displayed, so let us divide the price trend into three time ranges.
The megatrend of money lasted for weeks to months, reflecting the economic and political health of the country's currency. These large fundamentals change slowly from expansion to contraction, which is why these trends continue for so long.
Medium term trend
Despite the prevalence of large fundamentals in the long run, in the short term, traders' emotions can cause prices to soar or fall, which can be seen in intermediate trends, which may be contrary or opposite to the main trend. Usually, these trends will last for a few days to a week or so.
This is a behavior within a day, and in fact is not a trend at all, it is simply a random price behavior. Within a day, prices can be seen everywhere.
Which is the best trading time?
It is obvious from the above that the long-term trend of the transaction can obtain the maximum profit with the least amount of work. All you have to do is master the trend and keep the trend – but follow the trend for a long time and only really fit the patience and disciplined traders.
Mid-term trading trends may be very profitable and require less patience and discipline than long-term trading trends. You can make money in two time frames, and the time frame you choose depends on your personality.
I haven't mentioned the day trade, it's the most popular trading time, but it doesn't give you a real chance of success. There is a big industry selling garbage robots, the so-called low-risk day trading and scalping strategies, but they do not make money, and day traders suffer losses.
If you want to win in Forex trading, don't make mistakes that most people make, but for short-term trading – long-term trading, you will have a great chance to get a second income.