Lower time frame trading is always considered as the riskiest trading system in the financial market. But surprisingly most of the retail traders love to trade the lower time frame since they can secure quick profit from the small movements of the price. But you need to understand the associated risk in lower time frame trading also. If you make a wrong decision then within a very short period of time you are going to lose a big amount of money.
Some traders often consider lower time frame trading for the experts only. It’s true that scalping the market is extremely hard but in this article, we are going to discuss some of the amazing techniques which the pro traders use in lower time frame trading. But just by reading the article don’t expect to become a hero in the financial market. You have to practice hard in a demo account to build a strong level of confidence.
Price action trading
The price action trading signal is one of the best ways to trade the market. All the long-term traders use the reliable candlestick pattern to place high quality trades at the key levels. But when it comes to scalping you need to trade only the most traded price action pattern. Learning all the details of price action strategy is not so easy in fact the new traders will not understand many things. So, it’s better to go for some paid price action trading course where you can easily get a clear insight into the market structure and candlestick pattern. It’s true that learning all the formations of Japanese candlestick pattern is really hard but once you know the formation reason everything will become extremely easy for you.
Use of multiple time frame analysis
Multiple time frame analysis is one of the easiest ways to find false trading signals. In options trading, you will see that most of the traders are using multiple monitors in their trading room with same currency pair chart. But if you closely observe the chart then you will notice the difference in the time period. They use different time frame data to get a clear overview of the market movement in the shorter time frame. It’s not like that you will have to trade with multiple monitors as the most professional trading platform allows the traders to use multiple charts in the same window. So, learn more about your trading platform to get a clear overview of the market structure.
1 % risk rule
We all know the golden rule to make money is to reduce the risk exposure. In lower time frame trading you will be placing more than 2 trades in a single day. So it’s highly imperative that you are not taking risk more than 1% of your account capital. Always remember that losing money in Forex is very easy but recovering your trading loss is one of the hardest things in the world. But if you trade with proper money management then you don’t have to worry about the lower time frame. You might even many losing trades but a few winners will cover up your trading loss.
You need to change lots of things deep inside you to become a successful trader. The rookie traders get frustrated with few losing trades but if you consider the senior traders then you will be surprised to see that every single one of them embrace their losing trades. As long as you trade with high-risk reward ratio you can easily make money even after losing 50% of the time. Never think this market as a short cut way to become a rich person. Consider trading as your business and learn all the details about the different trading system. Based on your knowledge try to create your own unique system which will help you to make profit consistently.
