Time Frame Analysis
This is a main part for a trader or a investor. Time frame analysis is the most important because of liquidity, Market run for a liquidity that’s why important.
Always choose long time frame for pre analysis
When you trade on the 1 min time frame is pure gambling.because of you will see a profit / loss in every single candle and you will start taking a trade on every single candle. So that’s why don’t go for a 1min time frame
The 3 min time frame is mostly used for scalpar
You should trade in 5 min and 15 min candles. And other time frame like 30 min, 1h, and 4h are used for pre analysis for best results.
Let’s understand in detail. If you are a day trader, in a option, then 4h and 1h time frame is very important for analysing. because you need to find gap between candles and the liquidity and the main things is support and resistance. After that, you need to see in where is pending liquidity and and then shift to the lower time frame to see candles have formed or not. Like hammer candle or an inverted hammer, or any other candle. Then you need to check if there is any pending liquidity or not in lower time frame.
In 1h time frame, you need to drow the support and resistance level. And, you also need to check at the candles to see if there are any candles formed for entry on the buy side or the sell side. After this analysis is complete, you should move to the 30 min candles.
30 min candles, you just need to find support and resistance, and the final time frame is the 15 min and 5 min candles.
15 min candles, you need to find again support and resistance levels, and also check candles to show an entry on the buying side or a selling side. And that we need to decide whether an entry is forming on the buying side or the selling side. When we decided, then switch to the 5 min time frame to take entry point.
Before entry you should be check or confirmation 3 candles or 2 candles in the 5 min time frame, and I have already mentioned, you have to maintain the risk/reward ratio. Do not trade more than 3. Manage your money so that you can survive for many days or months.
One thing I have mentioned is that you have to draw support and resistance on every single time frame. because in the bigger time frame, you will see cristal clear, pending liquidity, and candel gap.
Most of the people This way analysed, there is no other way. To Understand liquidity or support and resistance.
And similarly, every time frame is support and resistance. Why I say that after analysing in the 15 min time frame, you should entry on the 5 min candle? because when you mark the 15 min support and resistance, and when the market comes in then most of the chances of the market reverse top to the bottom or bottom to the top.
Market running in liquidity if liquidity is none then market trend is side wise
Note – Some people mark support and resistance in the 5 min candle, and finding pending liquidity, and entry to the 1 min candle. And most people get trapped and lose all their money.because they do not have proper plan and calculation. That is the time when you need to control your mind, manage your money with the right mindset, and work on a single risk/reward, ratio 1:2. Do not go beyond this, and work on a single setup until your capital grow. And after that you should increase the lot size and also increase the risk/reward ratio.