Advice on Higher Time Frame

[tjlizwelicha]

I changing my trading charts to 1Hr, but can use some guidance. I did my check off list which is looking at higher frames (D and WK), however when the market opened I was nervous because it was going up and down. Veteran 1hr and D Chart traders are you looking at the lower time during the opening? lol Just a lot of anxiety as if my premarket didn't work.

When do you place your call option if any? The first hour or sooner? Thanks in advance for advice and recommendations.

 

[rad14733]

@tjlizwelicha Perhaps you moved to higher timeframes prematurely... I would never be trading options based on only 1H, D, and W timeframes... But, then again, I guess it all depends on your personal trading style... That said, I'd consider basing entry choices on the shortest timeframe as being optimal... You never mentioned your trading style so my advice is somewhat subjective... However, the best practice for any style of trading is to buy low and sell high, for long entries... You can't do that unless you use lower timeframes for making those decisions...

 

[tjlizwelicha]

@tjlizwelicha Perhaps you moved to higher timeframes prematurely... I would never be trading options based on only 1H, D, and W timeframes... But, then again, I guess it all depends on your personal trading style... That said, I'd consider basing entry choices on the shortest timeframe as being optimal... You never mentioned your trading style so my advice is somewhat subjective... However, the best practice for any style of trading is to buy low and sell high, for long entries... You can't do that unless you use lower timeframes for making those decisions...

@rad14733 thanks for the input. I guess I should've mentioned what type of trader I am, sorry. lol I am a momentum trader. I have trader for about a year on the smaller time frames and have had some great success. However, I do notice that there is a lot of noise and I tend to pull out the trade during a pull back . I really appreciate the advice, it is helpful. Thanks

 

[rad14733]

@rad14733 thanks for the input. I guess I should've mentioned what type of trader I am, sorry. lol I am a momentum trader. I have trader for about a year on the smaller time frames and have had some great success. However, I do notice that there is a lot of noise and I tend to pull out the trade during a pull back . I really appreciate the advice, it is helpful. Thanks

For momentum trading you are better off with shorter timeframes and then using longer timeframes to help you at determining and staying in trades... I watch multiple timeframes and usually scalp options using 3m or 5m charts while monitoring 3m, 5m, 10m, 15m, and 30m... The higher timeframes keep me in trades and the lower ones are used for pinpointing entry and exit... For swing trading I would just bump up the higher timeframes to suit my needs...

 

[tjlizwelicha]

For momentum trading you are better off with shorter timeframes and then using longer timeframes to help you at determining and staying in trades... I watch multiple timeframes and usually scalp options using 3m or 5m charts while monitoring 3m, 5m, 10m, 15m, and 30m... The higher timeframes keep me in trades and the lower ones are used for pinpointing entry and exit... For swing trading I would just bump up the higher timeframes to suit my needs...

Thank you so much for sharing, because this is a new trading strategy I am trying. So this helps a lot.

 

[Slippage]

@tjlizwelicha you should define objective exit criteria so you have rules you can follow and take the emotions out of the decision.

For instance, you could use a moving average as your decision point. The guy who runs Stocklock trading uses a close below 9 period exponential moving average as one of his exit rules. I've heard of people using 2 closes below 21 ema. The guy who runs TrickTrades uses 50 sma on a 1 minute chart.

I've also heard of indicators such as momentum or macd being used to make the decision.

You can trail your stop bar by bar on a higher timeframe chart. For instance, if trading 5m, trail on 15m. On a long position, as soon as the current candle breaks the previous candle's high move your stop just under the previous candle.

It doesn't matter much which criteria you use, and you can use multiple, just find something that fits how long you want to stay in the trade balanced with how much you're willing to give back. And then make yourself stick to the rules.