[PippinTom]

Hello David,


I have some questions about Channel Trading on the FOREX market:

I am currently using the 1-hour chart for Channel Trading and I understand that a new candlestick appears on the beginning of each hour.

My question is should I create an Entry Order for Channel Trading at the very beginning of each hour?

Or can I just create an Entry Order once the candlestick touches the target trendline even though current hour is not yet finished?



Thanks!


Regards,
Jeff

[David Waring]

Hi Jeff,

I think most traders would agree that this is really a matter of preference. Many traders like to use the close of the time frame that they are using because they feel that this is a more accurate reputation of what the market is actually doing. Traders who feel this way I think generally do because they feel that using the close does a better job of filtering out interbar spikes that may not really be a legitimate market move.

Other traders however do not pay much attention to the close when it comes to things such as this.

With this in mind what I would suggest is papertrading using both methods and seeing which method works out best for you over time. In general you should expect to be taken into more trades if you do not rely on the close than you will be if you do.

This may be a positive thing from the standpoint of more trades may hit your profit targets and therefore you will be more profitable. Or it may be a negative thing because you may be taken into more false breakouts in which case your stop will be hit more often.

If there are any other thoughts on this feel free to leave them below.


Best Regards,
Dave