Time Frame is a unit of time used to see any price movement that occurs on the charts (bar charts or candlesticks) until the formation of a new chart (bar charts or candlesticks). In the MetaTrader 4 has been available several time frames, namely M1 (1 minute), M5 (5 minutes), M15 (15 minutes), M30 (30 minutes), H1 (1 hour), H4 (4 hours), D1 (1 day ), W1 (1 week), and MN (1 month). Consider the example of price movements on the H1 time frame using the candlestick, and the indicator CandleTime where the price has been moving for 59:29 minutes, and still be moving for 00:31 minutes to be able to form a stem 1 candle.
Function of time frames is to determine the general trend of price movement will occur. Its use is relative, depending on the method or strategy of each trader. Scalper commonly used time frame M1-M15, Intraday / Day Traders generally use the M30-H4 time frame, and Swing / Long-Term Traders generally use the time frame D1-MN.
The use of lower time frames such as M1-M5 does not allow to set a target profit (Pips) is large, because the movement that occurs on the lower time frame that does not have a strong trend. Generally, the price movement on the lower time frame is only a correction of price movements on the larger time frames. In this time frame the trader (scalper) only determine a target of 5-10 pips and a stop loss at low tide as well, because the stop loss should be adjusted to a specified profit targets. The possibility of a stop loss will be installed quickly touched, because the stop loss level is within the range of average price that occurs in a large time frame.
The use of a large time frame like D1-W1 allows to set a target profit (Pips) is large, because the trend of price movements that occurred at the time a large frame and strong directional. In this time frame the trader can determine the profit target of 100 pips or more. However, with great profit target, stop loss so that the pairs must also be large. In this case traders also require big capital.
The smaller the time frame, then the movement (Pips) is generated for each of the graphs (bar charts or candlesicks) will be smaller. The larger the time frame, then the movement (Pips) is generated for each of the graphs (bar charts or candlesticks) will be even greater. To choose the best time frame, then it must be adapted to the method or strategy that you use. The use of a low time frame needed experience in trading activity, so it is not recommended the use of a low time frame for forex trading beginners.
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