When one enters into a trade there are a lot of variables to consider. Point of entry is perhaps the most obvious one. Target, or objective, how far we expect price to move. Stop loss, fixed or mental, where we admit that we were wrong and cut losses. Size of the trade and the leverage used, how much are we willing to risk and how much is expected to be made. These are the most recognized elements of a trade making decision, but there are more. One of them is duration of a trade. How long the trade is expected to take..
Perhaps it is not critical to an investor, somebody who is willing to "sit" on a security for an undetermined long haul. Which is fine. This person is seeking returns consistent with some kind of overall market indexes, believes them to be above average, but doesn't know how long this will take. Active trader should have a better grasp on this part of trading. After all, money shouldn't be tied up forever in a nonperforming trade. So, one ought to develop a way to determine the length of expected transaction. It doesn't need to be precise, nobody knows the future, but having educated opinion will be very helpful in planing strategies.
Since my activity as a whole is a simplified version of swing trading, I also use that theory to determine time objectives. Swing trading is based on a premise that market moves in a more less symmetrical way. Size of a move down, for example, will determine size of correction or reversal. And vice verse. The trick is recognizing the "dominant swing" which dictates all calculations. The most recent one usually serves the purpose. Same principle applies to time analysis and prediction. Here is an example using daily GBP-JPY chart.
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FX Madness. 
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May 10th, 2009, 02:37 PM
Trading is not about predicting anything. You follow the market which is greater than you and all our "predictions". 
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