The Secret To Choosing The Perfect Chart Time Frame | Best Chart Time Frame For Day Trading?


Hi friends, in this video, we will learn and
see, which are the best chart time frames? For trading & investing.
Chart timeframe is one of the most important factor in chart analysis and Professional
traders have specific rules about choosing a time frame because their choice of time
frame is most commonly not based on a trading system or technique, nor upon the market that
they are trading but upon their own trading personality and preferences. The timeframe used for forming a chart depends
on the compression of the price data: intraday, daily, weekly, monthly, quarterly or yearly
price data. Daily candlestick is made up of intraday data
that has been compressed to show each day as a single candlestick, or period.
Weekly candlestick is made up of daily data that has been compressed to show each week
as a single candlestick and so on. Most traders and investors summarize trading
time frames into three broad categories. These time frames are typically known as the short,
medium and long term time periods. And these time periods definitions might be different
for each individual trader because of his trading style and trading preference. In my view, trading time frame can be defined
as follows: Short Term – This time frame for a traders
covers a period lasting from minutes to days. For example, scalpers, day traders and some
swing traders are short term traders. Medium Term – This time frame for a swing
trader covers a period lasting from days to weeks. For example, swing traders and investors
are medium term traders. Long Term – This time frame mostly for an
investors covers a period lasting from several weeks to years to decades. And most investors
are long term traders. Traders usually concentrate on charts made
up of daily and intraday data to forecast short-term price trends. In market, micro
traders or we call them as scalpers, they commonly use 1 minute chart timeframe for
scalping the market. Day traders usually uses 10 min, 15 min, 30
min or max hourly chart to analyze price movement and take trades accordingly in the market. Hourly chart also can be used by swing traders
who takes positions for more than day but less then week. While daily chart is useful for short to intermediate
term swing trading. The shorter the timeframe and the less compressed the data is, the more
detail that is available. But flip side we will see high volatile moves which might affect
decision making and turn into losses. While for long term investors, short-term
charts can be volatile and with a lot of noise. Large sudden price movements, wide high-low
ranges, and price gaps can affect volatility, which can distort the overall picture, that
why Investors usually focus on weekly and monthly charts to spot long-term trends and
forecast long-term price movements. Because long-term charts (typically 1-4 years) cover
a longer timeframe with compressed data, price movements do not appear as extreme and there
is often less noise. Professional traders & investors use a combination
of long-term and short-term charts to stay ahead of crowd and to find perfect entry and
exit from the market. Long-term charts are good for analyzing the large picture to get
a broad perspective of the historical price action. After that short term chart are good
for catching perfect top or bottom of long term trend. So best chart timeframe is depend on what
types of trader you are? And also what are your market preferences. In upcoming video
will explore these points and each timeframe in details with practical examples so stay
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