What basic strategies really work, and which timeframe

Beginner Questions
1

what could be some basic pattern(s) that one could start out with, that really work, and for which timeframe? i was thinking of a trendline bounce (for uptrends and downtrends, at least 3 touches), on the 4h and 1h timeframes. i looked at the charts, and if i pick the setups which are aligned to their next higher timeframe, seems like i can pull it off enough to profit from.

my impression from other threads is that lower timeframes (15m and less) are more difficult to profit from, so i’ll probably avoid that for some time.

thank you all
Harpoon

2

[QUOTE=“harpoon;723772”]what could be some basic pattern(s) that one could start out with, that really work, and for which timeframe? i was thinking of a trendline bounce (fr uptrends and downtrends, at least 3 touches), on the 4h and 1h timeframes. i looked at the charts, and if i pick the setups which are aligned to their next higher timeframe, seems like i can pull it off enough to profit from. my impression from other threads is that lower timeframes (15m and less) are more difficult to profit from, so i’ll probably avoid that for some time. thank you all Harpoon[/QUOTE]

I would take time to learn support and resistance on the daily time frame.

3

[QUOTE=“harpoon;723772”]what could be some basic pattern(s) that one could start out with, that really work, and for which timeframe? i was thinking of a trendline bounce (for uptrends and downtrends, at least 3 touches), on the 4h and 1h timeframes. i looked at the charts, and if i pick the setups which are aligned to their next higher timeframe, seems like i can pull it off enough to profit from. my impression from other threads is that lower timeframes (15m and less) are more difficult to profit from, so i’ll probably avoid that for some time. thank you all Harpoon[/QUOTE]

For patterns :

Double tops and double bottoms.
Head and shoulders.

For price action signals :

Engulfing
Pin bars
Inside bars and inside bar fake outs.

Daily chart and h4 timeframes work best.

Plot support and resistance levels and wait for price action there.

4

If you want to trade chart patterns than you should use daily time frames otherwise you may face lot of false signals.

5

i should clarify that when i asked for patterns, i wasn’t specifically referring to head and shoulders etc., but just what basic setups one can do and for which timeframe that will really work.

i was under the impression that setups for the daily timeframe don’t occur that frequently (?).

hoga:u mentioned support and resistance for the daily time frame. what did you have in mind? upward breakout of e.g. a downward trendline? or trendline bounces from a horizontal range or uptrend support line?

6

They all do and don’t in every time frame. You’re starting to reach. You seem to have enough idea where you should be asking yourself what influences are going to make price continue or break the formations and the probabilities. What are your steps of the entire process to capitalize off any move? Are you going to play the minutia and randomness on the minute chart or are you going to go out further? Concentrate on the plan.

7

My personal experience of last 3 years is that price action trading on daily time frames is the best way of trading. You can do stress free trading but you have to patience as you won’t get too many signals on daily time frame.

9

Any strategy you focus on, will work eventually, the more you practice and fine tune, the more you eliminate the chances of loss.

10

Yep, chart formations that are completed in longer-term time frames are generally considered more reliable and of course they also result to larger/prolonged moves. I usually wait for those long-term patterns, although they can be rare as some of the folks here already mentioned, but I still zoom in to short-term time frames like the 1-hour chart to look for potential entry levels on inflection points.

11

I think there is no rule about basic strategy which will work in any time frame because every strategy has its own good and bad point, also it is depending on your style of trading. If you’re short-term traders so you will need to learn how to use low time frame (although you need to look on higher time frame too sometime) and vice versa, if you’re long-term traders so you will often use high time frame than low time frame. So, it is depending on your style of trading to choose which time frame.

12

thanks once again everybody, especially the experienced people. i’ll focus on daily, 4h and 1h timeframes ( but prioritize daily and 4h), and leave chart patterns for later (only on the daily timeframe). It’s interesting to note that a small 4h chart can actually sometimes fit on a 1h chart, so that’s something new i learnt (it’s really a 1h chart). and when i try 1h timeframe trades, i’ll make sure the setup doesn’t fit on a 30 min (or less) timeframe (as it isn’t really a 1h chart then). and it also comes down to how much zoom you use too. i have it zoomed in to the point where the colored in/not colored in candles are clear to see and it doesn’t look “squashed” . as this too can change our timeframe.

on another note, you can change to the higher timeframe to see the bigger picture direction, and also zoom that out one click, to see sometimes a different bigger picture. so that’s interesting.

getting there …

13

I think that trading with the trend is the best way to trade. One of the best way to see it is to look many timeframes to make sure that there [B]is [/B]a trend. Why don’t you look at the Cowabongasystem? It does exactly that through a multitimeframe analysis.

Another great method is this one. I am trading it with promising success. Wichever the one system you chose, it has to be simple.

14

Honestly i don’t have much strategy but i do use martingale method, its highly risky and can empty the account within no time while i do it with few indicators like MA and BB.

15

Okay.

My personal favourite is the engulfing candle.

Here’s the AUDUSD chart

On the daily chart its in a downtrend, and price has tested former support as new resistance.

After rejecting the horizontal level with 2 daily pinbars, price then formed a bearish engulfing.

On the h1 chart look for engulfing candles at price retraces and enter in the direction of the trend (sell) exercising proper risk reward.

Same setup, different timeframes.

image-1773376151.jpg480×700 33.9 KB

image-1619781003.jpg496×700 33.2 KB

image-2838628472.jpg503×700 31.4 KB

16

thanks again everybody.
Yan: great idea. this is a retracement trade. on this site they teach to use it with a fib, but you don’t seem to worry about it. perhaps your method still works as there are still 2 pieces of convincing evidence (the candlestick pattern and previous support/resistance). i’ll check it out. thanks. do u make money from this pattern, even on the 1h timeframe?

17

[QUOTE=“harpoon;725683”]thanks again everybody. Yan: great idea. this is a retracement trade. on this site they teach to use it with a fib, but you don’t seem to worry about it. perhaps your method still works as there are still 2 pieces of convincing evidence (the candlestick pattern and previous support/resistance). i’ll check it out. thanks. do u make money from this pattern, even on the 1h timeframe?[/QUOTE]

Yes I do!

This is the way I trade.

The engulfing candle works on any timeframe but I prefer to see it on the daily and h4 charts before I take a position.

As the screenshots show, its profitable on the h1 timeframe too but for optimum and sure trades look for these on the h1 chart after you’ve seen price form an engulfing on the higher timeframes.

As for Fibonacci, I do use it but as a point of confluence rather than a potential bounce point.

If you plot your fibs on the daily AUDUSD swing, you can see price rejected the 61.8 level.

I look for 3 to 4 points of confluence before entering a trade.

So taking this setup as an example.

  1. In a confirmed downtrend.
  2. Tested previous support as resistance.
  3. Rejected Fibonacci level 61.8
  4. Bearish Pinbar
  5. Bearish Engulfing candle

That’s enough for me to enter any trade.

But if say price does not make an engulfing on the higher timeframes but still rejects a key level, then I look for h1 engulfing candles on a retrace to join the direction of price.

18

This is pretty true. Some variables that would be change would be you SL/TP levels. I’d you trading on the daily chart you would probably have a 100pip TP and a lot larger SL compared to someone who trades on a 5min - 1hr timeframe your TP might be at 20-50pips.

19

Yani:thanks. I delayed my response so I could learn more about fibonacci first. Seems like there are candlestick patterns all over at many of and around the retracement levels (u just don’t know if it really will reverse). I might just go in right after e.g.a doji or whatever rather than giving up much ground by bouncing off a lot, and stick to the larger retracement levels (50-75% or so), with an initial stop loss outside the main fib swing highs/lows (since many of those fib levels seem to get broken in my tests anyway). and by using the deeper fib retracement levels the Risk:Reward is better. I just try to align the higher timeframe rather than looking for e.g. engulfing candles on the higher frame. But where do you put your stop loss? thanks again. and when you say 4h timeframe, how many candles are on your screen?

20

[QUOTE=“harpoon;726908”]Yani:thanks. I delayed my response so I could learn more about fibonacci first. Seems like there are candlestick patterns all over at many of and around the retracement levels (u just don’t know if it really will reverse). I might just go in right after e.g.a doji or whatever rather than giving up much ground by bouncing off a lot, and stick to the larger retracement levels (50-75% or so), with an initial stop loss outside the main fib swing highs/lows (since many of those fib levels seem to get broken in my tests anyway). and by using the deeper fib retracement levels the Risk:Reward is better. I just try to align the higher timeframe rather than looking for e.g. engulfing candles on the higher frame. But where do you put your stop loss? thanks again. and when you say 4h timeframe, how many candles are on your screen?[/QUOTE]

Not waiting til an engulfing candle forms is okay.

I used to do that too.

But sometimes price went against me when I traded off doji’s or other candles without seeing an engulfing?

So I stopped.

The reason why I wait for engulfing candles are because that’s the best way the market is showing me its hand, it’s direction.

A doji may mean indecision, but an engulfing gives weight to the direction of price so that’s what I wait for.

I’d rather wait for an engulfing to confirm the direction of price rather than get in early after seeing a doji THINKING THE MARKET WILL GO IN THE DIRECTION I THINK JUST BECAUSE IT BOUNCED OFF A FIB LEVEL OR HORIZONTAL LEVEL.

Being hopefully isn’t practical here, but trading according to what you see is.

Doesn’t matter if you missed the initial move, if it’s going to go in a particular direction then you can always hop onto that trade on a retrace say on the h1 timeframe.

Stop loss placement is usually 50+ pips for me.

My risk : reward is atleast 1:2 so I make sure the move is bigger than 100 pips and then I set both SL and TP accordingly.

Sometimes the move may go down further, but in anycase my stop won’t be bigger than 50+ pips and I hold for 1:3 sometimes.

Daily and h4 gives 1:3 and h1 swings usually give 1:2 in my experience.

The key is to wait for the best setups.
The ones you feel are gonna be real winners, with price action to definitely back your decision to enter the trade.

Waiting on those perfect setups mean your account grows gradually.

But getting in early on some unconfirmed moves may result in losing a little sometimes so.

And as for h4 candles, that’s the timeframe with every candle equalling to 4 one hour candles hehe.