I found on the internet a dozen approuches when it comes to trend, for me on a 1 min timeframe for scalping is hard to determine the trend. Some say daily others 4hours and others 1 hour?
Well my friend, the idea behind determining the trend actually depends on sensitivity of trader and indicators which are put to use.
Now, for an Intraday trader the the best way to scalp profit would be by looking at shorter time frame such as 1 min, 5 min, 15 min chart where as on the other hand for those traders who hold onto their positions mostly go for longer time frame such as 4 hrs, 1 day or 1 week.
A “trend” is something that exists [U]within and with reference to a specified time-frame[/U].
It’s relatively common for an instrument to be trending in one direction in one time-frame while also trending in the opposite direction in another time-frame.
I suspect that what you’re really asking, with a view to the undoubted additional odds-shifting attraction of taking only trades that exist within the one-minute time-frame and are in accordance with a simultaneously existing trend in a higher time-frame, is which time-frame(s) to look at, to determine that?
It’s going to vary according to how long your average (both mean and median) trades run for, and their variance, I think?
Without knowing any more, I would suggest either five minutes and ten minutes, or five minutes and fifteen minutes. (People often, and for good reasons, follow Marcel Link’s advice on this subject: look at “the next two higher, commonly used time-frames”. His book on the subject is called [I]High Probability Trading[/I], if you want to take a look for yourself.)
Two further suggestions …
(i) You need to research this yourself, according to the type of trades you’re doing, and make sure from both backtesting and forward-testing a large number of trades that whichever method you adopt is proven to be a good option (there’d perhaps be no point in arbitrarily excluding trades which [U]are[/U] still collectively profitable, even if not [U]as[/U] profitable), and …
(ii) Be aware that there’s an awful lot of “noise” on one-minute forex charts, and the chart-periodicity you use to enter and/or manage your trades is generally going to be inversely proportional to the “signal-to-noise ratio” you experience.
Looking at four-hour charts, to determine in which direction to take trades on one-minute charts sounds to me like a sledgehammer to crack a nut, and I’d be [I]extremely[/I] surprised if that’s a sensible option.
Edited to add …
It needn’t have [I]anything[/I] to do with indicators at all, Simon: the question is perfectly relevant even to those of us who trade without them.
Yep, there’s really an overwhelming amount of strategies for determining trends. And as some of the folks already mentioned, it depends on on how long you plan to hold on to your trades or how often you can watch the markets. In any case, the longer-term chart usually allows you to gauge the overall trend while the shorter-term one could help you pinpoint entry levels. So if you’re looking at the 4-hour and 1-hour, you can base the trend on the 4-hour then the entries on the 1-hour. Same goes for daily/4-hour or 1-hour/15-min, etc. Hope this helps!
When those three pretty SMA’s are lining up like the attached picture, then it is a trend…in my definition.