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If you’re a day trader your focus would be to spend your day time trading and grab more opportunities to make a profit within these hours. In forex, making a regular profit in day trading is possible only if you are competent enough to make the right entries. There are only 5 days from Monday to Friday that you can utilize to hit your profit goals.
In this post, you will learn, the daily time frame forex trading strategy.
The daily candle is formed after 24 hours. The powerful day trading strategy is to use 21-Period EMA to find trend direction plus and 9-Period EMA to find dynamic support and resistance. For RSI wait for Over bough and over solid signals
There is no technique for RSI for a day trading strategy. It comes in handy. All you need to notice are overbought and oversold signals. The right entry is to capture the breakout point after being overbought and oversold on the RSU line. It comes with experience only.
Important Facts About Daily Time Frame Trading
A forex trader is usually unaware of the importance of daily time frame trading strategies. Most traders do their trading activities by adopting a lower time frame. Here we are going to tell you important facts about the daily time frame that will surprise you and persuade you to select it immediately.
Let’s read!
You May Be Relaxed And a Good Administrator
This is the most important fact about which you will never think it is so beneficial. Why? Let me explain with an example. Just suppose you are trading with a lower time frame of 5 minutes. You have to face five new candles during these 5 minutes. It is stressful and makes you tense to handle it.
The time is too short for making good decisions to buy and sell. On the other hand, a daily time frame makes you relaxed and tension free. You can make good decisions about trading plans and can buy and sell after keen observation. Here, you can get a new candle after 24 hours.
There Is No Need For News And Events
News and events both play an important role while trading with a lower timeframe. If you study your trading chart, you can notice that the price ratio goes up and down fastly. Here you have to be attentive and updated with all the ups and downs occurring in the market.
If you aren’t aware of the market conditions and news, you will be out of the trading world without any reason. On the contrary, daily time frames don’t rely on news and events. So, adopt daily time frames without considering market news and start trading without having any pause.
Trade Freely
As we have mentioned above, daily time frames formed only one candle in 24 hours. It is beneficial because now you don’t need to check market conditions again and again. You can trade freely until the new candle may be formed the next day.
In this case, your trading plans are not the slave of the trading market and you can make decisions as you want. In short time frames, it is not possible. There you have to watch changes occur in the market from time to time and make trading plans according to market conditions.
Earn Big Profit With Small Account
It is another important fact that is attached to the daily time frame. In this time frame, a trader does not need to observe the market the whole day. There is no need to look at trading charts all the time.
So, you can attach to the trading market and give your full time to trades. As a result, you may win a big chance to achieve a handsome amount of profit. It is what the daily time frame provides you and helps you to become a successful forex trader. That’s why the daily time frame should be your priority.
Daily Time Frame Forex Trading Strategies: 3 Steps
There are three ways to trade forex in a daily time frame. The first step is to capture trends on a daily chart. The second step is to look for support and resistance and the final step is to check RSI. Let’s check out the brief details below
Step-1 Capture Trend On Daily Chart
The first step is to follow the trend line on the daily chart. It is important to check both ongoing trends and trend reversal. On a daily time frame chart, you can do this by using 21-Period EMA and 9-Period EMA.
Step-2 Look For Support and Resistance On Daily Chart
After capturing the right trend we need to find support and resistance level. In an uptrend, the area between 21-Period EMA and 9-Period EMA set the support level.
Similarly in a downtrend, the area between the above-mentioned moving averages sets the resistance level. Now decide your entry point when support or resistance breaks.
Step-3 RSI on Daily Time Frame
It’s a handy tool with no secret to entering the trade. For RSI you need to identify over bough and solid pints n the line. The right entry is to wait for the points to break. If you are a beginner, rely on the above steps.
FAQs
Which time frame is best for day trading forex?
Day traders like to adopt short-term trading strategies. For that, they select the time frame for trading activities that last from 15 minutes to 4 hours.
Which time frame is best for swing trading?
The best time frame for a swing trader is between six months to one year. Once you can handle multiple trades, you can move towards day trading.
Why is the daily timeframe the best?
It is best because a new candle may form every 24 hours when you trade with the daily timeframe. It provides you more time to think and make plans along with executing trades. As a result, you can make good decisions.
Final Thoughts
After reading this post, you have learned a lot about the daily timeframe in the forex trading market. We have discussed all basic points that show the importance of time frames in trading plans.
Daily time frame trading provides you with many benefits as it makes you relaxed to make good trading decisions. You can also get the freedom to achieve a big winning ratio with a good amount of profit.
Additionally, by adopting a daily timeframe, you will be able to trade swing and positive trading strategies.
Remember that daily time frame trading plans are not for those who are willing to earn compatible income.
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