Understand the timeframes and units of time in forex trading

When we look at a chart on the trading platform of a forex broker, the period of time that he shows us and the time that it represents depend on the unit of time (also called “timeframe”) selected in the settings. A unit of time is the period of time that represents a japanese candlestick on a chart. For example, if one selected a period of one day (D1 or daily), the chart on the trading platform will be represented so that each japanese candlestick represents one trading day, regardless of the type of graph that we study, each point, line, candlestick or bar will represent one day’s trading if the time unit is the D1. If you want to change the unit of time of your graph and that you set it in 60 minutes, then each japanese candlestick will represent one hour rating of the chosen market.

As you can see on the chart below taken from the trading platform cTrader, FxPro, there is a multitude of units of time that are offered on the platforms of forex brokers. According to his trading style, a trader will observe the market from different angles, if he practice the scalping then we can imagine that he is going to study graphics in the short term unit of time is 1, 2 or 5 minutes (M1, M2, M5), if you practice day trading it will probably be the graphics in units of time 5, 15 or 30 minutes (M5, M15, M30), and finally if they practice the swing trading or the trading position, then it will study the charts over the long term, between the 60 minutes (H1) and the unit of time daily or weekly (D1 or W1). All of these units of time are available on the different trading platforms of the brokers and therefore allow to analyze the markets in the short, medium and long term.

Small reminder that, regardless of the time unit and the trading platform you use, make sure always to choose a forex broker or a binary options broker regulated, which gives the right to the Warranty Forexagone. Choose a broker with licenses such as Etoro or FxPro is highly recommended and does not cost anything, it allows you as an investor to protect its capital and to keep clear of the scams with the investment.
 

Leave a Reply