To optimize trading efficiency, you can use a combination of long and short time frames, helping to make decisions based on both larger trends and precise entry signals. A popular strategy that many traders use is:
Long time frame (1H, 4H, or Daily):
Used to identify the main trend of the market.
The 4H (or 1H) frame is suitable for identifying short-term trends and changes over the medium term. If the price is in an uptrend on the 4H, you can open Long and vice versa.
The Daily frame is for observing long-term trends and major support/resistance levels.
Intermediate time frame (15M, 30M):
Used to refine entry points and help identify the continuation of trends.
When the trend on the long time frame is clear, you can use the 15M or 30M frame to find entry signals (for example: when there are breakouts at minor support/resistance levels or signals from technical indicators like RSI or MACD).
Short time frame (5M, 1M):
Used to find precise entry points, especially when you want to trade in a scalping or day trading style.
Good for catching small events, like breakouts or sudden changes in trends.
Effective combination:
Long time frame (4H, Daily): Identify the main trend.
Intermediate time frame (15M, 30M): Refine entry signals.
Short time frame (5M): Identify specific entry points, used for short-term strategies or tracking precise signals.
This method helps you maintain an overall view of the market while still being able to seize short-term trading opportunities.