Peter Bain use mainly daily, hourly, 15 minute, and five minute charts. The daily chart will help you define the overall trend from a position trading point-of-view, and the hourly (one hour) chart will give you a feel for the intraday trend. The 15 minute chart is used for entry and exit – with assistance from the five minute chart, where price is moving quickly, and you need to be closer to the action. Please note that the five minute is not to be used for scalping, as there is a lot of noise there, and you could easily get whipsawed.

Make sure you are using charts that are generated from the same data source that feeds the dealing engine, as is the case with both platforms mentioned above. That way, what you see is what you get when you buy or sell. Some charting packages do not ccurately reflect where price is at any given moment in time.

INDICATORS

Peter Bain really only espouse one – MACD (for divergence only). MACD Divergence is covered extensively in his course and my trading examples MACD is his favorite indicator, and that would be his choice.

The nine and 18 exponential moving averages are okay too to give you some sense of price direction, but he is not a believer in using moving averages for this market – so am not too thrilled about their application and use. Go ahead and plot MACD on the charts you are working with.

He will give you more information in tomorrow’s email on his simple, yet powerful Forex pivot trading system.