Broker Training and Education

When you start to trade, it can be difficult to identify what’s the best time frame that you can trade. The alternatives are whether to trade short term, medium term or longer term. It may also be confusing even knowing what those terms mean. For a day trader, a trade that lasts a few days would be long term. However to an investor, a trade that lasts a few days would be a very short term trade. The definition of what is short, medium and long term is set by the trader himself. It is common however, for traders to think of trades that last days as short term, weeks as medium term and months or years as long term. The definitions are not set in concrete though, and each trader will have their own definition.

It is vital to identify the trading time frame that suits yourself. Some people will never be successful at day trading. These kinds of people are not suited to checking and being concerned with the market movements every hour during the day. For other types of personalities, waiting for trades to develop over weeks or months is like watching grass grow. Day traders are happy and suited to trading small movements in the market. It is also a case of matching the trading time frame with your lifestyle and other obligations. It is just impossible to be a day trader if you have a full time job and cannot watch the screen all day long.

Diversifying is a good idea to consider once you have mastered you preferred time frame. It is less common to diversify across time frames as it is against markets and systems. Discipline and organization are vital if you will attempt to trade across time frames. You need to have full belief in your systems and ability to see trades to the end. It is likely that you’ll have conflicting signals from the various systems. For example a short term system may indicate a buying opportunity while the medium term system is indicating a sell in the same market. It is easy to get confused and just sell out of all positions. It takes discipline to do the right thing and follow the signals as they are presented without regard to what the other systems are indicating. Trading in multiple time frames is much easier said than done.

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