Changes in foreign exchange market prices can be divided into tick charts, minute charts, hourly charts, daily charts, weekly charts and monthly charts according to different time periods. Different trend charts have their own unique behavioral characteristics. , if you do not master these characteristics, the tools of technical analysis are meaningless. Let’s take a look at one of the Forex Trading Tips : how to grasp the 5-minute chart?
Most investors are accustomed to looking at real-time charts to make orders. As soon as the real-time chart moves, they jump into the market. Some people buy at the pre-planned price, and the real-time chart drops rapidly, and they hurriedly cut orders. It is the performance that does not understand the characteristics of real-time graphs. The main function of the real-time chart is to accurately record the price level, and its trend direction will change at any time. Under normal circumstances, the fluctuations of the real-time graph are relatively small.
Changes in foreign exchange prices are basically undulating. In the rising waves, there will be many falling small waves interspersed. Therefore, when the hourly chart is basically rising, the price of the 5-minute chart may be falling, and the real-time chart may rise and fall many times in 5 minutes. Therefore, experienced investors will not let themselves be led by the real-time chart. . Some investors consciously avoid looking at real-time charts after placing orders as planned, so as not to disturb their emotions.
After careful study of the real-time map, it can be found that it has sensitive characteristics in addition to its precise and variable characteristics. For example, when the cross exchange rate of the Australian dollar is stronger than that of the British pound , the investor holds an order to buy the British pound. When the price of the British pound rises and encounters a resistance point, the investor may refer to the real-time chart of the Australian dollar. Because the Australian dollar is stronger, its real-time price The chart may be the first to break through the resistance point, at which time the GBP buy order will not need to be rushed to close the position.
In addition, when placing an order according to the plan, but the price of the resistance point has not been identified and there have been dozens of losses, you can closely observe the real-time chart. If there is a new breakthrough in the price, it is advisable to consider cutting off the losing order. Compared with the sensitive and changeable real-time chart, the 5-minute chart is more calm. The 5-minute chart is characterized by being more sensitive to the price of resistance points and support points, which is suitable for grasping the timing of incoming and outgoing orders.
Strictly speaking, many methods of technical analysis are used on the 5-minute chart, and their reliability must be greatly discounted, because the characteristics of the 5-minute chart are only sensitive to resistance points and support points, and its fluctuations and changes. Usually there is no indication of the direction of the trend. Just relying on the resistance points found on the 5-minute chart is usually not very strong.
Most investors are accustomed to short-term operations, especially short-term operations that close positions before the market closes on the day. For such investors, their best ordering tools are not instant charts, 5-minute charts, but 15-minute charts and hourly charts.