Money trading profits in forex and CFD's. Where are the profits hiding? I think they are hiding somewhere between the 5-minute bar chart and the daily chart. One of the main topics that many traders often talk about is why new traders should only trade the larger time frames. I consider a big time frame from to be a one hour chart or longer. I look at the daily bar chart to get a big overview picture of the CFD and currency market without all the noise of smaller time frames. I find that this makes my decision process easier.
What about noise? I mentioned that noise is a reason why I don't trade the smaller than 5-minute time frames. Noise, to me, are the constant waves and ripples that make the price action of a currency pair go up and down.
Obviously, this can give you many opportunities to put in trades but what I have found is that the more trades people put in on these smaller time frames, the more money trading they lose. Most retail traders simply don't have the skill to pick enough winning trades to make it profitable, and they also don't have a system that will keep them out of a bad deal.
Clean money trading profits are why I love trading the 5-minute chart so much. Yes, it is true that the 5-minute chart has some noise, but the best thing about it is that you know where the big players are hiding. Trading 5-minute bars doesn't require you to sit in front of a computer all day long watching the market go up and down. Now, that I only trade the 5-minute chart, and I look at each CFD and currency pair that I trade once every hour to one hour. I put on my trades, and I'm monitoring. I do have an app that lets me track how my trades are doing, and I even sparingly check that.
I love the freedom that this type of trading give me. The funny thing is that you can make these overarching type of day trade plays on the daily chart. For example, it isn't odd to see me put on a trade chasing 50 pips or more when I see an engulfing price action pattern on my CFD chart. I also sometimes will trade a trend that looks like it is going to continue with a day trade like approach. By day trade, I mean that I will close this position or seek to reach my target within 24 hours.
So where are the money trading profits? They seem to be hiding on the larger time frames such as the 5-minute bar chart. As you can see, my method is all about simplifying things. I want to make a handful trades, and I do not want to chase mediocre trades. Once I put on trade, I let it run its course to a strategic exit point. I occasionally alter or add on to it. I don't make any decision of seat-of-the-pants.
Trading signal service for you!Curious about online trading? Want to make more money, be highly successful and have positive experiences in the niche? Welcome to TradingSig.com, a website that will...
Trading knowledge come from education and practiceTrading knowledge don’t magically appear but take hours of study, learning what to look for in a profitable investment. You can achieve this knowledge through reading, but...