MTI Analyst Articles

Forex Technical

Multiple Time Frames

February 16, 2010

 

Jose Tormos

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Chart Analysis

 

• One primary advantage of using multiple time frames is that you can see a pattern develop sooner. A trend that appears on a weekly chart could have been seen first on the daily chart. The same logic follows for other chart formations. Similarly, the application of patterns, such as support and resistance, is the same within each time frame. When a support line appears at about the same level in hourly, daily, and weekly charts, it gains importance

 

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Chart Analysis

 

• When testing a trend-following system, we should expect that a trend of 100 days, compared with a trend of 50 days, will produce larger profits per trade, greater reliability, and proportionally fewer trades. As you increase the calculation period, this pattern continues; when you reduce the calculation period this pattern reverses. You are prevented from using very short calculation intervals because slippage and commissions become too large; the longest periods are undesirable because of large equity swings. There must be a clear, profitable pattern when plotting returns per trade versus the average holding period.

 

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Analysis

Here at MTI we pride ourselves on our flagship trading software, MTI 4.0. It features easy to use drawing tools, technical indicators and charting capabilities. In this article we explain how forex technical analysis works by providing informative articles on the most popular and widely used forex technical indicators and chart reading basics. Traders are welcome to read on about our examples of how these technical indicators generate trading signals, examples of some trading strategies, and also explain the information that can be observed through spatial intelligence about the conditions of the market at any given moment.

 

All of the analysis is done using the MTI 4.0 charting software, practice these, and other great strategies for FREE, by downloading a 14 day trial of MTI 4.0 charting.