as I couldn’t find the answer I would like to ask here a question which came to me quite some times in the last days and as the last thread in this forum worked quite well for me, here one more:
I’m trading (mostly) in a 1 hour or 4 hour time frame. To be sure that I am trading in the same direction like the pair is moving to on a higher time frame, I do always look as well at the daily, weekly and monthly time frame. When they are all in the same direction it is pretty clear, but which one is the right one if e.g. the monthly one had an up-trend for more than 40 bars, only the last 5 bars did a retracement to, let’s say, the 38,2% Fibo-level. This means that on a weekly time frame we had a down-trend of 12 candlesticks and on the daily time frame we had a short up-trend of few days.
If my trading rules tell me to trade only in the same direction as on a higher time frame, how do I know which one is the right one???
Looking back at my previous trades I discovered that I fudged on myself choosing the one that “confirmed” my trading idea :8:
Is there any common rule or experience from someone trading already for 200 years and could tell me which one I should choose, please? Many thanks in advance!