In deciding what time frame to trade the EURUSD, you need to understand what kind of trader you are.
This is a very key step, as application of the wrong time frame for your trading style will lead to errors in trading, and losses.
Even though many experts propose looking at multiple time frames before making a trading decision, you will still need to focus on one time frame to provide the chart on which to identify your entry signal.
The questions to ask in determining the time frames for your trading style are:
a) What kind of trader are you? Are you a scalper, day trader or swing trader?
b) Do you look at charts daily, weekly or monthly?
c) Are you in the market for daily profits, or do you prefer to be in on the long haul like Warren Buffett?
Generally speaking, scalpers (that is those who open and close trades in a matter of minutes, looking for few pips at a time) will be more suited to trade the 5 minute or 15 minute time charts, since their entry and exit time is extremely short.
Day traders would be looking at the 1 hour charts.
Those who prefer to hold positions for days or weeks at a time will be looking at the longer time frames: 4hour, Daily and Weekly charts.
Once you can identify your trading style in any of the categories listed, it becomes EASIER to know which charts to use in identifying your entry signals and making your trading decisions.
-----------------------------------------
OPTIMUM TIME PERIODS TO TRADE THE EURUSD
-----------------------------------------
The Euro is a European currency.
We would therefore expect maximum trading activity for the Euro to occur when Europe is in daytime. This corresponds to the time zone known as the central European time, which is GMT +1.
The London session is therefore in tandem with the trading hours of the Eurozone.
The US Dollar is the currency of the United States.
New York, the commercial centre of the US located on the East Coast, is located in a time zone which is 5 hours behind the GMT. The US day comes alive at 1230GMT (when daylight savings time is on) or 1330GMT when daylight savings time is off.
Now that an explanation of the time zones within which both regions operate in has been made, it is very clear to everyone that the optimum time to trade the EURUSD is the time in which the London session is open (when Europe is awake) and when the London and New York trading sessions OVERLAP.
Remember: The keyword here is OVERLAP.
My favorite time to trade is when sessions are OVERLAPPING.
Now it is not as if there isn’t enough trading activity at other times of the day, such as when only the London, Asian or late New York sessions are open.
But the OVERLAP PERIOD provides the GREATEST opportunity as far as market involvement by traders is concerned.
Now that we have identified the times of the day when trading in the EURUSD presents greatest opportunity, we also need to identify what DAYS of the week are best for EURUSD trading.
There are five trading days of the week.
For any given trading week, forex trading commences at 2100GMT on Sunday night, and terminates at 2100GMT Friday night.
Trading activity is highest on TUESDAY, peaks on WEDNESDAY and THURSDAY, and tapers off on Friday.
Traders are advised to trade mostly on Tuesdays, Wednesdays and Thursdays when maximum volatility for the trading week is at work.
DO NOT be overly tempted to trade sessions which fall into your sleeping periods.
Mental alertness and concentration, two powerful weapons in a trader’s arsenal, are attributes that only a mind well rested by sleep can attain.
Restrict your trading to the overlap time zones that fall within your waking hours.
This leads us to the next discussion on the common mistakes traders make that cause them to lose money and how to avoid this.
Inside EFS, we go in great detail on exactly how you can enter a market and be right there to ride the wave (at the right time) for MAXIMUM profits.
You can get it here!
Are you ever amazed at how time passes so fast?
I know I am.
Have you ever said to yourself "I will start my training & education tomorrow" or "I will get started next week" or "when the first of the month arrives I will start fresh". What usually happens? That's right... nothing.
How much more of your hard earned money do you want to lose?
So again, if you have ever said any of these things to yourself, I urge you to decide once and for all that the longer you wait, the DEEPER the hole you'll be digging.
The more you lose, the more FRUSTRATED you'll be... and the HARDER it is for you to get back in the game.
Now the GOOD news is... if you REALLY want get good at this, understand that you have to do it RIGHT NOW, your transformation starts RIGHT NOW, not later, not tommorow... RIGHT NOW so make a commitment to yourself and take FULL control of your finances, profits & trades TODAY:
This is a very key step, as application of the wrong time frame for your trading style will lead to errors in trading, and losses.
Even though many experts propose looking at multiple time frames before making a trading decision, you will still need to focus on one time frame to provide the chart on which to identify your entry signal.
The questions to ask in determining the time frames for your trading style are:
a) What kind of trader are you? Are you a scalper, day trader or swing trader?
b) Do you look at charts daily, weekly or monthly?
c) Are you in the market for daily profits, or do you prefer to be in on the long haul like Warren Buffett?
Generally speaking, scalpers (that is those who open and close trades in a matter of minutes, looking for few pips at a time) will be more suited to trade the 5 minute or 15 minute time charts, since their entry and exit time is extremely short.
Day traders would be looking at the 1 hour charts.
Those who prefer to hold positions for days or weeks at a time will be looking at the longer time frames: 4hour, Daily and Weekly charts.
Once you can identify your trading style in any of the categories listed, it becomes EASIER to know which charts to use in identifying your entry signals and making your trading decisions.
-----------------------------------------
OPTIMUM TIME PERIODS TO TRADE THE EURUSD
-----------------------------------------
The Euro is a European currency.
We would therefore expect maximum trading activity for the Euro to occur when Europe is in daytime. This corresponds to the time zone known as the central European time, which is GMT +1.
The London session is therefore in tandem with the trading hours of the Eurozone.
The US Dollar is the currency of the United States.
New York, the commercial centre of the US located on the East Coast, is located in a time zone which is 5 hours behind the GMT. The US day comes alive at 1230GMT (when daylight savings time is on) or 1330GMT when daylight savings time is off.
Now that an explanation of the time zones within which both regions operate in has been made, it is very clear to everyone that the optimum time to trade the EURUSD is the time in which the London session is open (when Europe is awake) and when the London and New York trading sessions OVERLAP.
Remember: The keyword here is OVERLAP.
My favorite time to trade is when sessions are OVERLAPPING.
Now it is not as if there isn’t enough trading activity at other times of the day, such as when only the London, Asian or late New York sessions are open.
But the OVERLAP PERIOD provides the GREATEST opportunity as far as market involvement by traders is concerned.
Now that we have identified the times of the day when trading in the EURUSD presents greatest opportunity, we also need to identify what DAYS of the week are best for EURUSD trading.
There are five trading days of the week.
For any given trading week, forex trading commences at 2100GMT on Sunday night, and terminates at 2100GMT Friday night.
Trading activity is highest on TUESDAY, peaks on WEDNESDAY and THURSDAY, and tapers off on Friday.
Traders are advised to trade mostly on Tuesdays, Wednesdays and Thursdays when maximum volatility for the trading week is at work.
DO NOT be overly tempted to trade sessions which fall into your sleeping periods.
Mental alertness and concentration, two powerful weapons in a trader’s arsenal, are attributes that only a mind well rested by sleep can attain.
Restrict your trading to the overlap time zones that fall within your waking hours.
This leads us to the next discussion on the common mistakes traders make that cause them to lose money and how to avoid this.
Inside EFS, we go in great detail on exactly how you can enter a market and be right there to ride the wave (at the right time) for MAXIMUM profits.
You can get it here!
Are you ever amazed at how time passes so fast?
I know I am.
Have you ever said to yourself "I will start my training & education tomorrow" or "I will get started next week" or "when the first of the month arrives I will start fresh". What usually happens? That's right... nothing.
How much more of your hard earned money do you want to lose?
So again, if you have ever said any of these things to yourself, I urge you to decide once and for all that the longer you wait, the DEEPER the hole you'll be digging.
The more you lose, the more FRUSTRATED you'll be... and the HARDER it is for you to get back in the game.
Now the GOOD news is... if you REALLY want get good at this, understand that you have to do it RIGHT NOW, your transformation starts RIGHT NOW, not later, not tommorow... RIGHT NOW so make a commitment to yourself and take FULL control of your finances, profits & trades TODAY:
