Most people who start trading fx automatically rule out the idea of trading the daily price charts. This is because they prefer the fast pace of the short term charts such as the 1 minute and 5 minute charts, and prefer to try and make speedy profits instead. However the fact is that you can make a lot of money buying this particular time frame.
This is a lot more relaxed way of trading you can make just as much money. For instance when day trading you will probably be making profits in the region of 5-10 points per trade, several times every day (if you are lucky). However you can make just as much profit, if not more profit, by trading one single position on the end of day charts.
You just need to wait for the right trading types of conditions to be met on one for the major currency pairs, whether you are swing trading and looking for a price reversal, or whether you are waiting for your possible breakout, for example. Using certain indicators to help you, consequently it can be quite easy to find profiting trades, and the beauty can be that you only need to be for your computer for around 10 moments a day (at the end for the trading session). You can set your target price and stop loss and let the trade unfold in it’s own time.
That is why it is much better to apply the longer term charts, plus the daily chart in particular is quite a good choice because so many various traders trade this time framework as well. This means that technical exploration works really well because everyone seems to be watching the same price levels and the same indicators. It should be noticed that these indicators work much better on the daily chart as opposed to they do on the 5 minute chart, for example.
Don’t get everyone wrong, it is possible to do very well fx trading the short term charts. However it is one of the hardest ways to make money from currency trading because if you keep an eye on the markets every day, you will know that they move around very quickly and quite often in a very random fashion. There does exist generally too much noise for making money consistently, regardless of that system you use.
The only method Available profitable on these short time frames is to trade early morning breakouts. This is when you wait for a skinny overnight trading range on one of the major pairs, and then trade in the same guidance as any subsequent large, using pivot points to get additional guidance. Although I’ve got to say that even this technique is not always that trusted.
So the point can be that the daily charts is a really lot more profitable than the short time frames. They are not so stressful and the price goes are far more predictable considering many of the technical indicators are a lot more reliable. Therefore To get the cheapest you try and trade these charts if you are still struggling to make money trading the intraday price charts.
While you are looking at the fast paced 1 minute or 5 very small chart, the price flies with the place, seemingly at random. In the daily chart, however, it could actually look as if it’s almost never moving most of the time, which is why a person really need to check this chart afterwards of each trading session, in the event the latest bar / wax light has closed.