After being successfully unsuccessful with a number of intra-day strategies in my formative years as a trader, I came to the conclusion that perhaps I did not have the mental agility to trade the smaller timeframes. I was, after all, compulsive and impulsive with my trading decisions and lost. Big time!
Not wanting to give up after taking a hit like the majority of people who ‘have a go’ at trading, I discovered the daily chart and devised my own low frequency, high reward style of trading. My transition from the 5 minute chart to the daily attracted some light ridicule from some of my trading peers who thought it was, at best, amusing to witness what was seen as such a regressive step to being a “part-timer” in the art of trading currencies. I, however, have been profiting from the market on a consistent basis in a relatively effortless manner ever since!
Certainly, if you are a struggling intraday trader like I was in my formative years, trading this timeframe could be your saving grace.
More free timeRather than spending hours hunched over the screen tending to your trades, end-of-day trading strategies allow you to set your orders up with your broker and walk away for 24 hours so that you can keep your day job and enjoy more lifestyle. After all, who said watching a bunch of moving bars on a chart for hours was really that interesting?
You can always be in the ‘opportunity flow’As you are trading the daily chart, you only need to view the chart once a day to see if your trade set-up has manifested itself. This makes a refreshing change to having to tend to the smaller timeframes, such as the hourly, where you need to spend longer in front of the screen in order to be in the flow of opportunity: potential trade set-ups.
Your money is working overtime for youThanks to our ability to set and forget, we can happily walk away from the screen safe in the knowledge that we have our money working hard for us. Trading the financial markets just happens to be our vehicle for this. Consider the worst possible thing that can happen to our trade versus the best possible outcome. For example, losing what we have risked on the trade (ie: 1%) versus the profit potential (I target a minimum of 3%).
Target high rewardSwing trading on the daily charts grants us access to far fewer trades but set-ups with a far greater reward potential than intraday trading. We may be in positions for days, weeks and, in some cases, months but safe in the knowledge that this is in pursuit of high reward for what we compared to the percentage of our trading account we have risked (ie: 1%). We can have reward/risk ranging from
3:1 to 20:1, and beyond!