SHORT TERM TRADING TIPS
Choosing a low time frame and then processing various short-term forex trading methods is not a mistake, especially if the style fits your condition.
- Time Frame Management
The most important component in short-term trading is choosing a time frame. A short-term trader should focus on a low time frame. However, the unfortunate thing is that even if they are aware of the low time frame, sometimes they are still interested in doing a long-term analysis. They are trying to impose long-term trading methods into low time frames. If you have selected a low time frame, always try to be equipped with a long-term strategy. In selecting a time frame, there is very little time frame danger for technical indicators.
- Contain Bar and Candlestick
This price indicator has 2 main benefits: simplification and basic technical indicators. The first benefit is very important when you get stuck because of too many indicators. For a short-term trader, the simplicity of the technique is important and can’t be ruled out.
Short-term traders are not fundamental traders and big trends are not a top priority. When there is a bearish reversal and the lower-high and lower lows, we as a short-term trader should not be concerned with it. As a short-term trader, your position will not last long enough to feel the impact of major trend changes.
Then with regard to the second benefit, bars are technical indicators that rarely lie. Compared to other indicators that have late signals, with the bar, you can know the market bullish.
Candlestick is more descriptive but not so predictive. He said that candlesticks are very useful for short-term traders who want to get the simplicity of chart pattern analysis.
- Confirm With Indicator
The function of a technical indicator is a confirmatory of a signal bar or candle. In addition to guides from simple object analyzers. In addition, by adding a channel indicator that he considers to have an important role. Bollinger Band, Average True Range Band, Standard Error Channel, if appear simultaneously on the chart and mutually confirm, Then you can see the top and bottom pattern of the price is quite valid.
- Use of Trading Session Changes
Forex has a very varied trading time and divided into various sessions. It turns out that you can use it as one of short-term trading strategy. The principle is quite easy, when the London market rally continues into the New York session, then go with the crowd. But only when American traders are pushing for higher-quality patterns early in the session.
After that, you have at least 3 hours to find a profit opportunity. This is because liquidity began to subside and New York market began to move slowly until the opening of the Asian session.
- The Play Breakout Strategy
Last trading breakout tips for traders who love to play in the short term. If there is a price breakout of important levels, such as daily or weekly highs, and bar closing at high, then use the buy high and sell higher rules.
While from the technical side, you should note the bar in anticipation of the breakout. Similar to candlesticks, small bars with small high-low axes reflect market uncertainty. While a large bar means that traders are very confident.
If you find some big bars that are suddenly followed by a series of small bars, then be careful. A decrease in volatility like this is usually a sign of a breakout. If you notice, it is almost the same as Bollinger Bands signals in a large time frame.