Forex short-term trading can't just look at 5-minute Tudepu recommends multi-cycle analysis

The price movement of foreign exchange can be divided into market charts, minute charts (such as 5-minute charts), hour charts (such as 4-hour charts), daily charts, weekly charts, and monthly charts for trend prediction according to different time spans. Different types of charts have their own unique characteristics, and investors can develop different trading strategies based on these chart characteristics. With the help of technical analysisforeign exchange marketSeize the opportunity in the middle. The fluctuations in foreign exchange prices are essentially fluctuating like waves, which can be divided into large waves, medium waves and small waves. In the rising big wave, there are often many medium waves and small waves mixed in. Take the trend of the foreign exchange market for a week as an example. If the hourly chart of the week shows an upward trend, but the 5-minute chart may have obvious declines many times in the same week, this decline is a medium or small correction in the big rising wave. However, many investors focus on the 5-minute or even the market chart of the shorter line because they fail to recognize the main direction of the foreign exchange trend - whether the big wave is rising or falling. Since the shorter the trend of the exchange rate, the more unpredictable the performance, if investors focus on the shorter-term chart, there may be a situation of "seeing the tree but not the forest", which is easy to be biased by the repeated price fluctuations, lose the main direction of the market, and eventually be led by the short-term chart, thus frequently making wrong trading decisions.

Many traders only rely on the 5-minute chart for spot foreign exchange buying and selling every day. However, the reliability of some methods of technical analysis (such as the use of auxiliary indicators such as RSI or MACD) on the 5-minute chart often needs to be compromised. The characteristic of the 5-minute chart is that its ups and downs usually lack the ability to predict the direction of the main body, and investors can only chase small profits in the small waves. Even if the 9RSI indicator on the 5-minute chart has fallen to the seriously oversold area, it does not mean that it is possible to enter the market rashly, because the price may not rise or fall sideways when the RSI indicator shows oversold, and a longer period of consolidation is used to repair the technical oversold state on the 5-minute chart. Investors make trading decisions based on the auxiliary indicators on the 5-minute chart, and the result is often that after entering the market, the price has not reached the expected position squaring level, and there is a reverse unilateral trend. If you fail to stop the loss in time, you will eventually fall into the dilemma of "winning candy, losing the factory".

Therefore, when investors use charts for short-term trading, they cannot just look at the 5-minute chart, but also need to refer to the longer-term chart. The purpose is to identify the main direction of the market first, and then carry out short-term operations. Depu suggested that only by combining multi-cycle analysis can effectively avoid the situation of "seeing the tree but not the forest" and "winning the sugar, losing the factory" and improve the accuracy of trading decisions.