Frequently used timeframes in technical analysis
Time frame is considered as one of the most basic issues for stock analysis. In the first step to review a share, one must specify in what period of time one intends to review the share.
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This period can start from a few hours to several days or even months depending on the market and the share it intends to study. In the stock market, we usually need three different time frames to determine stock price changes in the short, medium and long term, which we will examine below.
What is your target market?
The first thing to consider is the market in which you operate. For example, in digital currency or forex markets, technical courses are usually considered on an hourly or daily basis, but in the stock market, in general, time courses are usually considered as daily, weekly and monthly.
The reason for this difference is that in the stock market, price changes depend on variables that show their time lag, but in the forex and digital currency markets, due to their special characteristics, moment-to-moment price changes must be considered.
A point you need to know
Of course, when it comes to setting timeframes, you should know that there is no single version, and different investors operating in the same market may consider different timeframes and happen to be successful. So it is better for each person to choose the right time frame according to their personality and trading strategy.
Time frames can be divided into three categories according to the target market: short-term, medium-term and long-term. In the following, we will become more familiar with the characteristics of each of these categories.
Types of time frames
Shorter or shorter timeframes give more trading signals, but you will usually have less time to decide on these timeframes. These timeframes can be suitable for people who work fluctuatingly or under pressure in terms of personality, can easily make good decisions, and also have the time needed to constantly monitor the market. Also, in low timeframes, due to the higher number of trades, the role of trading fees is very prominent, and markets that have lower trading fees are a better platform for short-term and volatile trading strategies and work with these timeframes.
Medium timeframes give you fewer signals, give you more time to make decisions, and are right for you if you have a medium-term trading strategy.
Finally, those who use long-term timeframes have a long-term vision and will not need daily market monitoring, and will naturally trade less than the previous two modes.
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