How to address time in forex trading?

I shared an article on timeframelessness the other day – “Understanding the concept of timeframelessness in forex trading”. The article emphasized that there is way more to chart reading than looking at candle sticks the way they are presented to us – equal length slices of time.

Congratulate yourself if you used your brain and now understand why candle sticks reading may limit the results of price action trading, how traders should approach time in a more nuanced manner and asked yourself what you were supposed to do with time then!

Obviously, time is a factor in everything we do or plan to do in our life. Now, the question is how to address time in trading and how to use it to our advantage.

First of all, let’s make it clear that there are different aspects of time to consider. The two main aspects to it are “Our time as we perceive it” and the time of “All that is and able to move price”.

The “Our time as we perceive it” concerns us, our life, our ability to be present when price is moving either in line with our expectations or some other way. As time passes we may juggle to keep up with whatever is presented to us on the charts and in whatever timeframe those things play out. This is a topic that I put aside for now as in my view a trader should be concerned only with how, why and when price moves to understand where his or her edge lies and how to adjust the perception of time to his or her advantage.

Now, the aspect of “All that is and able to move price” concerns how price movements play out over time as something totally independent from whatever we do – unless we are part of all that is and able to move price. I want you to understand and accept that going deep into the structure of how the forex market works, what roles certain entities play is not going to do any good to us. It is the exact reason why I prefer to talk about stop-outs, instead of stop hunting. We consider and trade a phenomena and a process as it makes its marks on a chart and we do not want to be judgemental as it usually leads to blindness. “All that is and able to move price” simply refers to any power that has the ability to manipulate and move price with intention, over time. The question is, how that mechanism operates and how to capture its intention by reading a chart?

We have already dismissed the idea that slicing up time into candles of equal time length is a good practice regarding the full understanding of price movements. We understand that the time we see on the charts is not our time, it does not flow the same way as time perceived in our life. We also understand that the idea of slicing time into candles of equal time lenghts has never been our idea but the idea of those who provide us with the trading platforms. We are also aware that most ideas in real life do not work to our advantage but in the end we stick to ideas passed onto us by others, not knowing or being able to figure out what a better idea should be.

What a candlestick charts suggests is that the candles are of equal importance, irrespectively from the time when they were printed. Now, I am not saying that candle sticks are ultimately bad, only that one has to be very careful with how one groups them into meaningful price action patterns. So the idea of timeframes should somewhat be challenged by all traders.

Can time be sliced up in the context of trading, in any meaningful way? One may consider the following thought that are coming from the concept of timeframenessness. You can ask yourself: what were the life changing things and events in your own life and how long did it take for them to play out in order to affect your life? You are likely to conclude that although it is possible to frame those events and processes in terms of time, but it is the processes and events that define the timespan of those and not the other way around.

Ok, so what is the problem? The problem lies with our expectation vs the nature of things. We may think that only because another candle starts to form, that candle should represent something that is different from the previous candle. Instead of thinking about the process and events, we tend to think in terms of direction, imminent moves and trends supported by technical investigation.

It may surprise you or not but let’s make it clear that the most basic timeframes in trading are the trading session, the price cycle and the so called news events. However, they overlap each other and they are acting agents for price to move or stay in a range. Do you understand what it means to your time perception and the complexity of price movements? There are many conclusions to draw but I typically use this insight to emphasize the importance of narratives development in trading. It is the narratives development that helps traders navigate the complexity of overlapping “timeframes” and use them to their advantage. I will talk about how to develop narratives later on to illustrate the concept and only mention here that there are elements of price movements that serve as building blocks for a narrative that can be used for practical implementation of the concept.

And now we can get back to timeframes. Timeframes are something that traders should create based on the narratives they develop, the same thing as when you try to understand your life as it is now, trying to figure out what happened to you, when it happened and how it played out, just to get clarity on where it is likely heading if you follow the same patterns of behavior observed as your own doings.

Now, there is one more thing to note and I have touched on this already. Only because something happens in a short time it could have the same effect vs something that happens over a long period of time and therefore we always strive to frame time according to processes, events and effects and nothing else. The key takeaway here is that the impact of an event may not necessarily be proportional to its duration and the impact is always more important than the duration of the event that caused it to materialize. When you understand this, you will be able to adjust your time and timing accordingly.

I hope this article generates deep thoughts and either confirms what you are already thinking and doing or create an entirely new perspective in your trading.

Thank you for your attention and sharing the article with others. Also thank yourself for thinking deep into what you are actually doing when trading the markets. All comments are welcome.

Immerse, Flow & Shine.

Be empowered,

Andras