Most of the indicators on forex can give you a signal to buy or to sell, however if you use only one indicator, probably you'll get a loss. There is a way out of this situation: using two or even three time frames on one chart would give you much less signals but they will be much more precised.
Why is it more profitable? Simply because we have only one rate on any currency chart. Let's take a stochastic indicator for example. It can give you a signal that market is overbought on a day chart and on an hour chart. Better would be to use day chart but what if market would react only on an hour chart? I would wait till market become overbought on both time frames and the rate would definitely bounce back.
We can't be sure what time frame is currently being watched by most of the traders. I like the idea of many time frames because it makes sense. There would work only one indicator at a time or multiple indicators at once.
Recently I've read that you can use multiple time frames for Fibonacci retracement levels. If there are 2 swings on 2 time frames you can draw the Fibonacci levels to find out the rate when the correction would probably stop. It is necessary to have both desirable rates on 2 time frames to be approximately in one place.
Don't forget about other indicators like MAs and Fractals. I would recommend to use 2 time frames: H1 and Daily for this strategy. If there are a low amount of signals then open other currency pairs, that way you can have much more signals.
No comments:
Post a Comment