It seems like everyone I hear about trading forex is using intraday charts, especially the 4-hour chart. After never being able to make any money and lots of losing trades, I started trading off the daily charts and the 5:00 p.m EST close. Trading results have improved significantly. I wonder if anyone else has had that experience.
Trading Forex with Daily Charts
- Thread starter formikatrading
- Start date
I know they have, and have often seen them saying so, both here and elsewhere.
My own experience ("back in the day" - I haven't traded spot forex for a long time, now) was the exact opposite, I must say: faster charts suited me much better.
On slower (e.g. daily) charts, my trade-entry criteria always led to higher win-rates, but I found (at first to my surprise, until I analyzed it in a lot more detail) that I made more return on my trading capital, and with no more risk, by trading from much faster charts, because the increase in trading frequency always seemed to more-than-compensate for the reduced "reliability".
Just my perspective on this widely discussed and sometimes thorny subject ...
Interesting -- thanks for sharing. I don't have the ability to (nor want to) watch the charts that much during the day anyway but I do understand how you could ultimately make more money if you had the time. For me, that increased reliability, though, is key.
On slower (e.g. daily) charts, my trade-entry criteria always led to higher win-rates, but I found (at first to my surprise, until I analyzed it in a lot more detail) that I made more return on my trading capital, and with no more risk, by trading from much faster charts, because the increase in trading frequency always seemed to more-than-compensate for the reduced "reliability".
Just my perspective on this widely discussed and sometimes thorny subject ...
Amateurs are said to open the market & the professionals close it. Swing/overnight, trend, & positional traders typically do most if not all their trading near the close. Those holding beyond the close have more skin in the game, this is the crowd that has a vested interest in the continuing price movement - some of these are big enough to move the market at times. With my Fx trading my entries and exits are all based only on the NY close, when the big players hands are shown. Sounds like you are a natural at Swing trading.
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Thanks for your post! My strategies have been developed (for all markets) using daily charts but I got sidetracked for a while with Forex thinking that I needed to use other intraday time frames. The reality is that, like you, the NY close is really the one time I want to (and should) focus on the markets. My path as a trader has been a difficult one but I have been "failing forward" for a long time and this path has enabled me to identify unique patterns and set-ups that are swing/overnight based -- and only recently have I been able to put everything I have learned over the years altogether. Best wishes to you in 2018!
The same results of-course - If you are able to find the monthly trend direction as well monthly trend consolidation areas than the H4 chart & the Daily chart should provide additional support to your chart biases before entering into A Position. The best thing here is to remember to allow additional Drawdown Revision or Swing High Means Revision - Giving the Price time as of find A good to strong support or resistance level giving the trends plenty of Margin Room as so Price gets a little time to work on the traded position outcome.
That is fantastic! One thing is, the farther out you go in time frames, the less significant the spread becomes.
Yes. I trade off the dailies only and also use the weeklies for gauging set-ups. Never open a chart labelled with hours or minutes (or ticks).