The time frame plays an important role in the Forex market. If you want to trade profitably in the market, never underestimate the importance of selecting the right time frame. Many traders don’t set an appropriate time frame in the market and thus they fail to make money. For instance, many naive traders in the UK love to trade the lower time frame. But lower time frame analysis always generates low-quality signals. So, the chances of losing most of the trades is very high. For this reason, successful traders prefer to stick to the higher time frame trading method.
If you set a lower time frame, the percentage of loss in a trade will increase. You are lowering the probability of your winning trades by trading in the lower time frame. So, if you set a higher time frame then your winning probability will also increase in the market.
How the higher time frame act as filters
The concept of a higher time frame refers to the need to set the chart of 4 hours or above. But if the chart is less than 4 hours, it is considered as lower time frame. Beginner traders should set their time frames as high as possible. For instance, if you analyze the trend in the 1 minute time frame you are never going to find the trend. On the other hand, if you analyze the daily time frame, you can easily predict the direction of the trend. But to use a trend trading method, you need to use the Saxo CFD trading account because they always give you free access to premium tools. With the help of a robust trading platform, it’s easier to find great trades.
You should set a higher time frame as it acts like a filter for the price movement. The term filter is used because in lower time frame traders can’t get all the information about the market. But in higher time frame you will get a clear picture of the market’s condition which will help you to trade profitably.
Keeps the trading strategy simple
To become successful in the market, you should keep a simple trading strategy. If you keep a complicating trading strategy then there are more chances that you will lose in your trades. Trading with higher time frames is a part of the K.I.S.S theory which means, keep it simple stupid.
You need to be clear on the idea that with the lower time frame you can’t make money consistently. You need to use the higher time frame in your trades to make money. Pro trader advise new traders to avoid the lower time frame and to put all their effort into the higher time frame.
Handle the higher time frame with patience
No matter how well you understand the market, you should never trade in a rush to make money. Always give time and patience to your trades so that you can use the higher time frame accordingly. Never forget, maintaining patience in the trade is the key to becoming successful in the market.
Don’t trade in the market without observing the market’s condition. New traders often do their trading without observing the market’s condition by losing patience and thus they fail in the trades. By being patience in the higher time frame you can also develop many strategies and skills which will help you to make money effectively.
The higher time frame not only helps you make money but also adds weight to your trading strategies. The more importance you will give to the higher time frame the better your trades will be. A higher time frame is one of the important assets in the market that no trader should avoid. Give yourself some time to learn more about the higher time frame so that you don’t end up making mistakes in your trades.