So what time frame should I use? In the first course,
this has been the most popular question.
My answer is always the same:
it depends.
If you go to a financial advisor and say: "hey, I want to buy some government bonds".
The first thing that the financial advisor will ask is: "would you like to invest in short term or long
term bonds?".
So if you ask me "what timeframe should I use?", I will reply "it depends on your time horizon".
If you want to plan long term investments, holding your position for weeks or even months, then weekly
and daily charts are good for you.
In any case I always suggest to analyze the daily chart even if you're planning to trade on shorter
timeframes. Daily charts can be used to keep an eye on the market's overall direction.
They say that trend is your friend,
so seeing the bigger picture on the daily chart can help you to trade on lower timeframes in the same
direction of the prevailing trend.
Unfortunately, I have seen many traders focusing on short term price action, forgetting about the daily
chart to analyze the main direction of the price.
Don't do this mistake, every morning take 10 minutes to check your daily charts and see if something
has changed.
Which time frame do I use?
I mainly use the 1-hour chart and I explain you why,
so you can see that the reason is strictly personal.
People who know me, know that I decided to become a forex trader not because I want to be rich but because
I want to have time for myself.
So I want to be able to work 4-5 hours per week without checking the charts every single hour.
For this reason I never trade on low timeframes like 15 or 30 minutes. At the same time,
I don't want to get bored, holding my positions for weeks or months.
That's why I tend to avoid daily and weekly charts.
So now you know why
I mainly use the hourly chart and sometimes I also use the 4-hour chart.
So, once again, what time frame should you use?
It depends on you. If you are very busy and don't have time to trade,
you can focus on the daily chart or the 4-hour chart.
If you have more time to dedicate to Forex trading, you can also consider to use the hourly chart.
In any case, I don't recommend timeframes lower than 15 minutes because it will expose you to daily trading
noise and random movements that will give you a lot of false signals.