Understanding Multiple Time Frame Analysis (MTFA)_2. What is MTFA_

Lesson 2: What is MTFA? Multiple time frame analysis involves observing the same currency pair across different frequencies or time compressions. As the name suggests, you do not monitor only one time frame to place your trade. You'll have to analyze the next time frame higher in order to gain insight about the broader trend and then use the lower time frame to make your entry. That's necessary as the direction of the trend could vary per time frame. A particular currency pair may be moving uptrend in the daily chart, but then it's at a downtrend in the 4-hour chart. Applying MTFA enables you to pinpoint your position in relation to the larger picture, therefore reducing chances of losing trades. In addition to monitoring the time frame you're currently trading in, make sure to keep an eye on new trend appearing from another time frame as it could hurt you if left unchecked.