The first is an issue of self-control. The latter refers to an equally common problem: often a trade will look beautiful on one chart (in one time frame), but ill-advised at best on another chart (another time frame).

A market that looks like it is beginning an uptrend in the daily time frame, for example, may be only pulling back into resistance on the weekly chart, where the momentum and trend are down. The problem is magnified even further with intraday charts, where trends in multiple time frames often conflict with each other.

To combat this problem, trader and trading coach Alexander Elder invented the Triple Screen System, which he outlined in his now-classic book Trading for a Living. (Buy it. Read it. Study it.) The idea of the Triple Screen Trading System is based on the concept that the market moves in waves of energy, and every larger wave consists of smaller ones, which themselves consist of even smaller waves.

To trade successfully a trader should choose to enter the market the moment when the waves are all moving in the same direction. This is when all of the market energy is aligned, and your chances of success are much greater.

If you are trading the daily chart, for example, you don’t want to consider only the daily chart, because you would only be getting a limited picture of what is going on with that market. You need to study the weekly chart also. And you need to study the hourly chart when the daily chart indicates it might be time to enter or exit the trade, or you risk a greater chance of being stopped out with a loss.

The triple screen trading system requires that the chart for the long-term trend be examined first. This ensures that the trade follows the tide of the long-term trend while allowing for entrance into trades at times when the market moves briefly against the trend.

The best buying opportunities occur when a rising market makes a brief decline; the best shorting opportunities are found when a falling market rallies. When the monthly trend is upward, weekly declines represent buying opportunities. Hourly rallies provide opportunities to short when the daily trend is downward.

First Screen – Market Tide

The first screen is the highest time frame you will use. Most stock swing traders use the daily chart to find trades. In their case, the weekly chart would serve as the first screen. The first screen sets the overall market direction, or trend. The market tide, if you will. Always swim with the tide. Experienced surfers will tell you you’ll catch better waves when surfing with the tide.

Second Screen – Market Wave

For most traders the daily chart would serve as the second screen. The idea is generally to catch a ride on any wave in this time frame when it moves in the direction of the tide, or weekly trend. Your chances of catching a nice, long and smooth ride under these conditions are much more favorable than if you are swimming against the greater tide.

Third Screen – Market Ripples

This time frame identifies the short-term frame and is used primarily for executing entries and exits. This allows you to enter with more precision, enabling you to use tighter stops, while increasing the chance that the trade will move immediately in your favor.

Markets cycle through the same technical patterns in virtually every time frame, whether a monthly chart or a 1-minute chart. You can use these patterns or indicators on the third screen to execute trades that look good on the second screen (and are aligned, of course, with the trend on the first screen).

Elder recommends using time frames that are roughly 5 times higher than the time frames below it. The hourly time frame generally works for the daily chart, and the daily chart for the weekly. For intraday charts, for example, one might use the one-minute, five-minute and 30-minute charts. For charts of FX pairs which trade 24-hours a day, four-hour charts are commonly used to execute trades made from the daily chart.

For more Free Education lessons, feel free to visit the CFD FX REPORT. They specialize in helping educate clients, and helping them find the best online brokers.

Over the past four months, as frightened investors all around the world fled from risk, the dollar recouped over two years worth of losses against a broad group of international currencies.

Since the beginning of August, the U.S. dollar has strengthened about 23% against the Euro, 34% against the British pound, and even greater returns against some currencies in the world’s developing countries.

As a reminder, the U.S. dollar has been on a decline since 2002. The recent upswing is encouraging but still has way to go to recover all its losses. But the fact remains, it still represents a significant turning point for a currency whose years of weakness had turned it into a source of amusement and embarrassment for Americans.

The weak dollar has had a significant impact on Americans as the cost of imported good rose and traveling overseas was made almost impossible except for the ultra rich..

But a strange thing happened as the world economy sufered. The increasingly wide scope of the financial crisis has also assisted the dollar’s rebound. It quickly became apparent that the U.S. is far from the only country with economic woes and struggling banks.

But for currency investors, the resurgence of the dollar may be a huge challenge. Some experts feel the dollar’s rebound may be short-lived, due to the  enormous challenges facing the U.S. economy. But then there are others who say it’s likely to hold its gains far into 2009 as economies around the world continue to fight global slowdown.

But for the moment, it’s a good sign for U.S. consumers. The stronger dollar is a big hit for Americans traveling overseas. They have tired of seeing their hard earned dollars buy less and less on each trip.

But for some companies, it is far less desirable. A stronger dollar does mean that the goods and services of American exporters are more expensive for foreign buyers. The result is it reduces their competitiveness. Another factor that is a negative for American multinational companies, their overseas earnings will now be worth much less after being exchanged back into U.S. dollars, hurting both their sales and profits.

There are storm clouds on the horizon. Once the U.S. economy begins to recover, the huge injections of cash by the Federal Reserve could cause rampant inflation. This is bad news for the dollar because it will erode a currency’s worth.

Some experts say the Fed will cut back liquidity before that happens, by raising interest rates or through other measures. For now, the Fed is focusing on the bigger problem – trying to prevent deflation, a vicious cycle of contracting credit and falling prices.

In the back of their minds, investors also worry about another scenario, where foreign investors lose confidence and scale back or stop buying U.S. assets. That would send the dollar plunging and interest rates soaring.

For investors, the dollar’s latest surge and murky future present a number of choices. For example, if you believe that, in the long run, the dollar is likely to weaken, one strategy to consider is owning stocks or bonds denominated in other currencies. Then if the dollar does lose ground, the returns will be worth more when converted back into dollars.

It’s all a gamble, so bring out your crystal ball and see what it tells you.