There are so many methods of forex trading analysis, one of them is multiple time frame analysis. The time frame will never be separated from a trader. It is closely related to the trading style that is owned by every trader, especially forex.

In forex trading, time frame is a feature in the trading platform that functions to group price movements in a currency pair based on a certain period. It will be displayed on the chart or graph.

On some popular trading platforms, there are several time frames that you can use to monitor price movements to determine when transactions are made. Among them are M5 (5-Minutes), M30 (30-Minutes), H4 (4-Hours), W1 (Weekly), MN (Monthly), and others.

The function of this time frame is to group prices based on a certain period in a currency pair. Multi-time frame analysis is a process carried out to see price movements in a currency pair in different periods.

How Important is Time Frame in Forex Trading Analysis

In practice, there is no maximum limit on how many time frames should be observed, but in general, this multi-timeframe analysis involves 2 or 3 time frames to predict the direction and price movements in the forex market.

If too few time frames are used, then you will have difficulty understanding market conditions due to insufficient data. Conversely, if too many time frames are used, it will result in an analysis that is too complicated.

A complicated analysis will make you have difficulty understanding the conditions that are happening in the market. Therefore, professional traders will usually only use 3 different time frames in their forex trading analysis.

It will provide a fair broad picture of the current market conditions. Based on the experience of traders and according to the Market Analyst of Didimax Forex Broker, doing multi-timeframe analysis in trading can make you more confident in making transactions. 

You will recognize and know when to enter or exit the market. That way, worrying about taking the wrong position can be avoided. With multi-timeframe analysis, you will not worried whether it is too late or maybe too early to open a position.

However, you must pay attention to choosing a time frame with the right duration. Especially for the three periods recommended in the use of this analysis. The time frame can be divided into three parts, Medium, Short, and Long. 

Group of Time Frame in Forex Trading Analysis

Long time frames are the right first step for you to start a forex trading business. By using a long-time frame, you will find out what trends are popular and dominant. They are usually used to find and determine general trends, not as signals. 

Therefore, traders who open positions are recommended in the direction of this long-time frame. The best forex broker will recommend this time frame to the ones who want to be professional traders.

In the medium time frame, traders will see a clearer flow and movement than when using a long-time frame. Monitoring the medium time frames can determine the right timing for traders to open positions.

In the development of trading techniques, from the use of medium time frames, you will see early indications of a possible reversal. It is also a good forex trading analysis for the middle class up to new traders.

In short time frames, you can look for entry signals (buy or sell). This is because the chart fluctuations look sharper and more descriptive so that traders can determine the more appropriate entry-level with the help of this time frame.

Simply put, you are trying to find the cheapest possible price to open a position and the highest possible price to sell. You will not assume that the decision taken later is deemed too fast or vice versa by doing this forex trading analysis.