BEST WAY TO TRADE MULTIPLE TIME FRAMES ALIGNMENT IN FOREX

BEST WAY TO TRADE MULTIPLE TIME FRAMES ALIGNMENT IN FOREX

Once you step into the world of forex trading, you’ll be bombarded with different trading strategies left, right, and center. Everyone will have their own opinion on what is the best forex trading strategy for you. In all honesty, there is no right answer on what is the best way to perform forex trading. There are countless strategies in the market and unless you go down the list and try each of them, you won’t really know which strategy works best for you. Let’s take a look at the best way to trade multiple time frames alignment in forex that not many people may have heard of:

MULTIPLE TIME FRAME ANALYSIS

Multiple time frame analysis is when you monitor or analyze a certain currency pair through different time frames. There are several reasons why someone may want to view a currency pair in multiple time frames. If you’re looking at a longer time frame like the monthly time frame or yearly time frame, you would be able to get a broader market perspective but it won’t allow you to see an accurate analysis of the current market sentiment.

Similarly, if you’re looking at a shorter time frame like the hourly or minutes time frame, you’ll be able to get an accurate analysis of the market sentiment but it won’t allow you to see the market from a broader perspective. This is why some traders prefer to use multiple timeframe analyses in order to understand the market better from all angles.

BEST MULTIPLE TIME FRAME COMBINATION

You should know that multiple time frame analysis won’t work with any combination of time frames. You need to carefully select your time frame combination in order to perform an accurate market analysis. Now the question arises, what time frame combination is best for me? The answer is that it depends on what time of forex trader you are. Depending upon your trading strategy, a certain time frame combination may work to your advantage much better than another. Here are the best multiple time frame combinations with the type of trader:

SCALPERS

A scalper is a trader who usually doesn’t hold their position for longer than a couple of hours in a day. Their aim is to open several small lots with the hope of making a good amount of profit at the end of the day. Since a scalper doesn’t hold their position for longer than a couple of hours, the best time frame combination for them would be the hourly time frame and the 15 minutes time frame. The hourly time frame would be used to perform trend analysis while the 15 minutes time frame would be used to determine the best entry point in a trade.

SHORT-TERM TRADERS

BEST WAY TO TRADE MULTIPLE TIME FRAMES ALIGNMENT IN FOREX 1
SHORT-TERM TRADERS (best way to trade multiple time frames alignment in forex)

A short-term trader is someone who usually doesn’t hold their position for longer than a day. Their aim is to perform daily market analysis to help them get good profits on a daily basis. Since a short-term trader doesn’t hold their position for longer than a day, the best time frame combination for them would be the 4-hour time frame and the hourly time frame. The 4-hour time frame would be used to perform trend analysis while the hourly time frame would be used to determine the best entry point in a trade.

SWING TRADERS

A swing trader is someone who usually holds their position from anywhere between a couple of hours to a couple of days. Their aim is to perform mid-term market analysis in order to determine what direction the market is going to switch. Since a swing trader doesn’t hold their position for longer than a couple of days, the best time frame combination for them would be the daily time frame and the 4-hourly time frame. The daily time frame would be used to perform trend analysis while the 4-hourly time frame would be used to determine the best entry point in a trade.

LONG-TERM TRADERS

A long-term trader is someone who usually holds their position for anywhere between a couple of days to a couple of months. Their aim is to perform long-term market analysis in order to get big profits at the end of the term. Since a long-term trader holds their position for up to a couple of months, the best time frame combination for them would be the weekly time frame and the daily time frame. The weekly time frame would be used to perform trend analysis while the daily time frame would be used to determine the best entry point in a trade.

BEST TRADING STRATEGY WITH MULTIPLE TIME FRAMES

It is important to note that not every trading strategy can work well with multiple time frame analyses. If you don’t currently have a trading strategy set, or if you’d like to change your trading strategy to fit into trading with multiple time frames alignment in forex, here are the best trading strategies that you can incorporate into your forex trading:

DAY TRADERS

As a day trader, you’re either a scalper or a short-term trader. Both these trader types can work well with the same trading strategy in multiple time frames alignment. For day traders, we recommend using Bollinger Bands along with the 20 Moving Average. This combination is perfect for multiple time frame analysis and can immensely help boost your profits organically. Both the Bollinger Bands and 20-MA are great indicators for trend analysis in any of the shorter time frames which is why they work best for day traders.

SWING TRADERS

This strategy will work well with both swing traders and long-term traders. Both these trader types can work well with the same trading strategy in multiple time frames alignment. For these types of traders, we recommend using the 200 SMA along with the 20 MA and 50 MA. This combination is perfect for longer multiple time frames. These are great indicators for trend analysis in any of the longer time frames which is why they work best for swing and long-term traders.

The Forex Secret

The Forex Secret

We provide Forex Signal Service, Fund Management, Free Analysis & Discussion. With all these services we give forex trading guides for beginner to advance forex traders.

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