Market cycle is more reliable the higher our time frame

Market cycle favours the higher time frame charts.

Why it’s easier to trade from a higher time frame chart?

A time frame is not a direct representation of decision time available. If we trade from a five-minute chart, we don’t have all five minutes to analyse and make a decision.

On such a chart we often have but a moment.

Mostly, however, we feel that ‘time’ to decide is what we gain from trading higher charts.

Another aspect of time and a higher chart, the daily for example, we need only look at a chart briefly but once a day.

Contrast that with a 5-minute chart where a trader looks at the chart all day long.

However, more important than the time available is the representative market cycle.

Take a look at the diagrams below to see the various market cycles, all screenshots taken within a moment of each other of sterling/dollar.

See how each time frame mostly projects a different cycle.

The higher the time frame traded, the more stable or more assured is the corresponding market cycle.

Traders work in larger or smaller market cycle microcosms the higher or lower the time frame chosen.

We can assimilate this to a swell at sea. As the swell approaches land, we get waves. In the shallows, we get choppiness and back currents.

The swell represents the weekly chart; waves are daily charts and the choppy shallows the five-minute chart.

Our current preference is the one-hour chart. As a full-time trader, this chart is mostly intraday; many bars meet the minimum scalp criteria and the market cycle, we think, is suitably defined.

Market cycle within a weekly chart
Market cycle, a weekly chart
Market cycle within a daily chart.
Market cycle, a daily chart
Market cycle within an hourly chart.
Market cycle, an hourly chart
Market cycle within a 5-minute chart.
Market cycle, a 5-minute chart

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