Questions will oftentimes come in during our live webinars regarding how long on average does it take for a position to hit its final profit target or stop loss when using the Daily chart.
Relative to the shorter time frames, trades take longer to develop on the Daily chart for sure. As far as the specific amount of time involved, that will vary depending on the market conditions, the trading strategy employed, the relative volatility of the pair being traded, etc. Depending on any combination of the foregoing, it could take a few hours, several days, weeks or even longer.
The trading style that I use employs trading in the direction of the trend on the Daily chart. Once that trend is determined, I then will enter the trade in that direction off either the Daily or the 4 hour chart on a break of support/resistance.
Since trading exclusively from a Daily chart can present issues regarding deeper stops, trades taking longer to mature and the like, our trading strategy as mentioned above is first to check the Daily 1 Year charts on the currency pairs to find the one(s) with the strongest trend in either direction.
(If you have questions about identifying a trend or determining a change in trend, click HERE for additional information.)
Once that is determined, check out the Hourly charts (4 Hour and 1 Hour) on the same pair to fine tune an entry into the trade in the direction of the Daily trend.Trading from a 1 hour or 4 hour chart in the direction of the trend on the Daily will generate more entry signals then on the Daily alone and a stop on a 1 hour or 4 hour chart is generally more tolerable for beginning traders and smaller account sizes.
