Time Frame Combinations for Trading

Time Frame Combinations

As we said earlier, multiple time frame analysis involves monitoring the same currency pair across different time frames. The way we choose our time frame combinations is based on our trading style.

There are four different trading styles: intraday trading, day trading, swing trading, and position trading.

Each trading style has a set of time frames we can use to analyze and trade the market.

Scalping/Intra-Day Trading Style:

Typically, intraday trading is a method of trading where the trader makes multiple trades each day, trying to profit off small price movements. It requires a trader to have a strict exit strategy because one large loss could eliminate the many small gains the trader worked to obtain.

If you are comfortable staying in front of your computer trading in and out of the market, then this style is for you.

Here is the set of time frames to use in your MTF analysis:

HTF: 1 Hour chart

ITF: 15 min chart

LTF: 5 min chart

Day-Trading Style:

Day trading is the act of buying and selling financial assets within the same day.

Traders open and close their position the same day to generate profits.

The difference between intraday and day trading is the fact that day traders trade the market for a long period, but close it within the same day, whereas intraday traders scalp the market for a very short time.

Here are the time frames to use for this trading style:

HTF: Daily chart

ITF: 1 Hour chart

LTF: 15/30 min chart

Swing Trading Style:

Swing trading refers to the medium-term trading style that is used by traders who try to profit from price swing. This trading style requires patience and large capital. Trades normally last between 2 days to several weeks.

Here is the set of time frames to use:

HTF: Weekly chart

ITF: Daily chart

LTF: 1H/4H Chart

Position Trading Style:

Position trading style is a common trading method where traders hold positions for a long period, typically over several months or years. They ignore short-term price movements in favor of profiting from long-term trends.

Here are the time frames you need to use for the MTF analysis:

HTF: Monthly chart

ITF: Weekly chart

LTF: Daily chart

Now that you have chosen your trading style, you need to determine the curve using the higher time frame.