Long Term Forex Charts
Currency trading offers many opportunities and many stock traders add currency exchange to their portfolios to take advantage of this situation. Stock traders often adapt quite easily to the forex market. The tiger trading strategy was designed as a trade to be held for several days or weeks. It can be held longer provided the trade continues to be profitable.
Animal traits are often used to describe human trader personalities. In the trading world, you will find bulls and bears, and now the tiger has made an appearance. The tiger is part of the cat family, hence has its patience. The reason for the tiger trade is that a tiger is able to wait until he or she is satisfied with the odds of a successful hunt. Traders who have this personality trait will find that this method of trading can become quite lucrative.
Long-Term Forex Charts
To be an effective tiger trader, you need to position yourself so that you can see the opportunity from a distance. The weekly forex charts are an ideal way to obtain a strategic overview of the market and its trends. Stock traders may find the weekly chart to be a short-term indicator when it is compared to the monthly or annual charts. In the foreign exchange market however, these weekly charts may be considered to be long-term.
What is the Weekly Chart?
In the forex world, a weekly chart is the only one that is indicative of a true close. The close of forex trade is on a Friday afternoon at around 17h00 EST and it reopens on Sunday at around 17h00 EST. The daily charts in this financial market generally do not close. There is a settlement time that is considered and the timeframe here changes depending on the market in which you trade. For illustration purposes, the New York market closes at 17h00 EST for settlement and a minute later the Australian market opens. The forex markets trade 24 hours per day from Sunday evening to Friday evening.
By using a weekly forex chart, you will be able to draw some lines, regardless of the type of chart you create. The chart will be maintained according to the weekly low or high points and the weekly close. This gives you the opportunity to see where the longer-term traders are focusing their attention. These longer-term traders usually take larger positions, hence they are a collective force in influencing the direction the market will take.
The Big Picture
For tiger traders, the shorter timeframe is dominated by the longer timeframe. Signals obtained from a weekly chart are normally more pronounced than those obtained from a daily chart. Prices on the shorter timeframes can do a turnaround and generate sell or buy signals even if the longer trend is still intact. When the longer timeframe indicates that prices are reaching a reversal level, you should switch to the short timeframe as it will indicate the reversal point.
Draft a chart of the currency pair you wish to trade and set a weekly timeframe as well as a daily timeframe. Set a relative strength index on both chart to two periods. Add three moving average, set at 20 periods.
Tiger trading is not suited to those who do not have patience. It requires the patience to let the market come to you rather than you chasing the market.