This is a question I received from a new trader who has been learning about how I trade. It’s an interesting question – especially during these times where the lack of a bullish or bearish Directional bias on many majors – is increasingly driving me personally to the shorter-term, intaday time frames.
I think it posed an interesting scenario for trade entry and I’m not opposed to it – it simply is another way to filter entries with a very short-term trade set up.
I can think a recent example of how this may work from this morning’s GBP/USD. Let me add – because I think it adds a nice footnote to this whole update – I was short the 60-minute based upon all the factors I list the videos EXCEPT for the five-minute Between the Greens “filter” so I took a small loss as prices rallied higher through the “00”.
So I recorded a short video series walking you though how this would work:
Let me know what you think and if you want me to do further articles on this idea of the five-minute Between the Greens strategy as the first step to a trade.
Another aspect of intraday or “day” trading in forex is making sure that scheduled and UNscheduled economic events are closely watched because they increase the volatility of price action.
The rhythm of the trading day centers around the financial center opens, overlaps, closes, and economic calendar. This pattern however is to a large degree quite predictable. Take a look at the Movement Per Hour for the GBP/USD. Here you can see how the volatility increases and decreases each day and when. The graph is broken down into 24 one-hour segments and is shown in Eastern Standard Time.