Graphical trading charts can be based on a variety of timeframes or even on non-time-related parameters such as number of trades or increment ranges.

With such a multitude of options, choosing the best trading timeframe or other variables for a particular trading style and asset class can seem like a daunting task. But if you are trading wisely this becomes a very simple task indeed.

How New Traders Choose Trading Time Frames

Many new traders spend days, weeks, or even months trying through every possible timeframe or parameter to find what really makes their trades profitable.

They try the 30 second chart, the M5 chart... and then, they try all the options that are not based on time, including ticks and volumes. When none of them are profitable, they think they made the wrong choice and try them all over again, assuming they must have missed something in the first place.

When they still don't find a profitable option, they tweak their system or trading technique a bit, and then retry all the timeframes and so on.

The thinking behind this attempt to choose the right timeframe or charting parameter is that "Every trading system or technique - and probably every market - has an optimal timeframe and other parameters. will help it perform at its best." If that belief sounds reasonable to you, then beware, as you may be about to enter the never-ending hunt for time frames that send so many traders away from trading.

How professional traders choose a timeframe

Professional traders spend about 30 seconds choosing a timeframe, as their choice of timeframe is NOT based on the trading system or technique - or the market they are dealing in - but on the PERSONALITY of their trades. their own.

For example, a trader who tends to make a lot of trades throughout the trading day might choose a shorter time frame, while a trader who typically only makes one or two trades a day might choose a longer time frame. . Traders can also switch their timeframe on a certain date, depending on how actively they are trading.

The reason professional traders don't spend too much time looking for the best timeframe is because their trading is based on market dynamics, and market dynamics apply in all timeframes.

Relevance of time frames

When you evaluate a certain timeframe in relation to your trading strategy, a price pattern that makes sense on the M2 chart will also make sense on the H2 chart; if not, then it's not a appreciated price pattern after all.

In other words, if your trading system or technique is not profitable, there is nothing wrong with the timeframe; which is the fault of your trading system or technique.

Other trading parameters

Non-time-based trading parameters are generally only used with trading systems specifically designed to use them.

Example: If a trading system has been created using a 100-tick chart - i.e. a move that will occur after 100 trades have taken place - then you should use a 100-tick chart . If a trading pattern is based on the scale of the price movement, then time is not important at this point and you should choose a chart, such as the Renko chart, which will allow you to trade based on the price movement. 

Having said that, there is nothing wrong with traders using trading parameters that are not based on time. If you like them because they are more intuitive and easy to read, then keep using them. But beginner traders should not assume that one of them has some inherent advantage over the other parameters or over the chart in the timeframe format.