How Much Time Do You Have to Trade?
In this section of lessons, you have learned a combination of Forex trading strategies that make up a complete trading plan for the daily chart. The beautiful thing about this combination of mini strategies is that they can be applied to any time-frame you like. The level of complexity will change the faster you try and trade but the concept will remain unchanged.
With a proper understanding of this complete trading plan, you could actually even trade right down to the 15 or 5-minute charts (only advised after you have proven to yourself that proper understanding). It would not be an easy task and does require developed skills, but the point is, these Forex trading strategies are adaptable to any time scale. Mastering the execution of this trading plan will be much easier for the amateur on the higher time frames. This is why we started with the daily chart. The good news is that you can use back-testing software to trade a few years of the daily chart in just weeks, this will speed up your learning curve dramatically rather than waiting in real time for a daily candle to close. That said you should also in parallel be practicing on a demo account to work on your patience.
Once you consider yourself a master of these techniques you will need to decide how much time each day you would be able to dedicate to trading. This will determine what type of scale you should even think about trading at. The other thing you should consider at that stage is how quickly you can respond to email alerts and get to your charts, this will also play a role in deciding what time frame is best for you. Finally; never underestimate the role that trading psychology will play on your trading journey. Take any step you make slowly and steadily.
How Much Complexity Can You Handle?
Once you reach a point where you feel confident that you have mastered these techniques, you can think about increasing your trade frequency. You have two real options that you can choose from.
- You can keep your eye on more currency pairs staying with the daily charts.
- You can trade the faster time frames but stick with just one or two pairs.
If you decide to start watching more currency pairs, you will just be doing the same thing as outlined in these lessons, but on multiple pairs. If you decide to trade a faster time frame then you will be making things a little more complicated. You will be doing the same thing but with the need to keep your eye on more layers. No matter how fast you wish to trade it is good practice to at least remain aware of everything that is going on right up to the daily chart. This will help you keep your eye on the overall picture and important price areas of your currency pair. This is important even if you are day trading the 15-minute chart as it could affect your trade.
How Many Trades Do You Want Each Month?
These lessons have really only provided a rate of trading that would get you 1-2 trades per month per pair as an average. With the correct knowledge on how to trade counter-trend waves and mid-wave continuation that rate would be doubled. Those types of trade are beyond the scope of these lessons which were only meant to introduce you to everything slowly. Now, if you were happy with 2 trades per month and traded 5 pairs then you would be looking for 8-10 trades per month. If you wanted to drop down to a 4-hour chart then you could start to look for the same amount of trades per week instead of per month, you would want to consider dropping down to 3 pairs as a maximum though and just look for 4-6 trades per week. The other option would be to look for 3-5 trades per pair per week and just watch 2 pairs but at a day trading scale where you are in and out of your trades in a matter of minutes-hours. The main point to be made here is that there are options. Just be honest with yourself about your skill level and decide accordingly.
Discover Your Trading Personality and Find Your Balance
Ultimately we are all slightly different but this collection of lessons provide you with a complete trading plan that is very adaptable. This is because what you have learned here is how to read price action, plain and simple. Only time will help you understand what type of trader you are as you discover how often you can check the charts, how much patience you have, and what kind of trade frequency you expect each month or week. Essentially this whole process will determine what your trading personality is and help you find the right balance for you. One final note is that with the right tools and the right knowledge, you can day trade with just a few minutes effort here and there throughout the day. Get yourself a membership here at WaveFX Trading when you are ready and you will discover all of that.
One Final Note on the Matter
The 4-hour, and even 15-minute, charts were mentioned. However, over the years we have gravitated towards price based Renko charts for any trading below the daily timeframe. They remove market noise and make everything outlined in these lessons much easier to see. Professional charting software for any type of chart that exists is included with membership here.