daytrading

[ampris2000]

question for people who are successful daytraders.

i have a trading strategy that works on the 30 min or more time frame charts.


on the 1 minute and 5 minute it works as well (looking at older data) but i tend to get more false signals than i do on the 30 min or more time frames.

is there a ta tool i can use to know when it will be a strong move ?

[pipmarshal]

Higher the timeframe lesser the entries and lesser false signals.
Lower the timeframe more entries and more false signals.

This is the fact with any strategy, when you go to a lower timeframe you have to compromise a bit on reliability of the signal. So while testing a strategy you start from a higher timeframe and go lower. Once you reach a stage where going lower is not adding to the priftability you stop.

For example, the below table gives the total profit for a month timeframewise. The profits and number of trades are arbitrary and hypothetical.

Daily chart - 50 pips from 2 trades
4 hours - 100 pips from 5 trades
1 hour - 150 pips from 10 trades
30 mins - 200 pips from 15 trades
15 mins - 175 pips from 25 trades

You would agree that 30 mins is the ideal timeframe because the winners give 200 pips more than losers. When you go lower to 15 mins timeframe, the false signal increases and the profit decreases. So you should find out the ideal timeframe for your strategy by back testing and forward testing. I do not believe there is any specific tool which might help you find out the ideal timeframe.

BTW, would you mind outlining your strategy for more info.

Have a nice 100 pips day.

PM

[Nqesab]

Hard to know without looking at what you are doing but as a rough guide use a 3 min chart to filter the 1 min signals, a 15 min for the five.

[Mplay]

Ampris

Not sure what U R exactly looking for to fit what U have. Perhaps a X bar back breakout would give U some assurance that the market intends to really move rather than chopping around within a trading range.


Another thing U may look at is volume. Is there real volume to get the market out of its range & move it to another level or is it just a quick fake.