Hi Swift-
Thanks for posting and the opportunity to respond-
Most Day traders likely use much faster time frame charts to take their entrys and exits within the up and down swings that occur durring the course of a single day.
A day trader that uses a 1 minute or 3 minute chart would perhaps find multiple -10+ entries where they would Risk only a few pennies on each trade- and take quick profits as well.
A day trader that uses a larger time frame chart -15 minute- 30 minute- is trading wider swings than the 1-3 minute, Their chart will show different trends than the 1-3 minute chart, and will Risk a larger amount on his trades- also expecting to make a larger amount on his winning trades than the faster 1-3 min. trader. He will likely find fewer trades that meet his setups during the day, and of longer duration. Perhaps he finds 2-4 periods in the course of the day.
Progressively, both of the day traders take their profits within the trends he captures during the course of the day, and most do not plan to hold positions overnight-
The swing trader (EOD) can hold a trade for a few days to weeks, or months-
position traders or investors likely hold for months and even years-
Each of these traders- Swing trader-Days
position trader- Weeks
Investor trader- months
progressively are hoping for a larger gain than the shorter time frame trader.
Each of these traders are willing to RISK more to gain more- than the other-
This is because the volatility swings on a monthly chart can be much wider than a weekly, and the weekly much wider than the daily, and the daily much wider than the 2 hour,
and the 2 hour much wider than the 15 minute, etc.
As an EOD swing trader, I am not restricted to viewing price solely through a longer time frame chart- I prefer to see the 4 incremental price action movements that make up the day on a 2 hr chart- However, I need to make a decision if I should respond to the earlier signals given on the 2 hour chart- or do I wait for the 'bigger picture' of the daily chart- The 2 hr chart I posted on my sell would not have appeared to be a reason to exit on the weekly- even perhaps not on the daily.
It is similar to the trader that focuses on the daily chart- Price may roll over and appear to be selling off on the daily, but the weekly chart would still appear positive. The trader that uses the daily chart may react to the information presented while the weekly trader would not be concerned.
Is there any right or wrong method? No- simply what the individual is comfortable with and how much they are willing to RISK on a position or trade-
Specific to the TBT trade-
My entry was not on a climax- but on a bullish continuation of the reversal of trend- It was followed by several days of normal sideways consolidation- It could have continued higher- and likely would have- If the Fed announced they would tighten sooner than their decision to delay the rate increase.
I sold on the initial signs of weakness because i felt the market had interpreted the Fed's move as negative for TBT- No point in Risking more to argue with the market.
The TLT buy-stop was executed on the same day- I tried to position myself to protect a position from loss and to get the early counter position reaction.
I don't know where this trade goes- I may get stopped of TLT as well. Since TLT held the larger recent period uptrending- I think it has promise to resume that uptrend- but there are market factors & reactions that have more to do with policy interpretation than
considering a company's balance sheet.
Thanks for posting-I Always appreciate a different point of view!
View attachment 149798
