Stock Market Education - Trading Multiple Time Frames

Trading using multiple time frames is just one very important method taught with stock market education and technical analysis …

What I mean by this is that no matter what time frame it is that you trade; a higher or a couple of higher time frames must confirm the underlying strength of the move that you are about to trade. See video below

Let’s say you are a day trader and your normal trading time frame is 10 minutes, you have just noticed a perfect setup on the chart and are about to place a trade or a bet …to confirm that the move has potential for a successful trade, you must check it out on at least two higher time frames.

In stock market education or technical analysis, the time frame you intend to look at is not a hard and fast rule, In this case, I always use the 30minutes and 1hour to trade with the 10minute chart…very well you say - what must I look out for?

First and foremost the Ema 200 on the higher time frames must confirm the trend direction on the lower trading time frame display. In the chart this is seen as a black line drawn over the 1 hour Ema 200 moving average, which appears in exactly the same position on the 30 min and 10 min charts.

The gravity of the move will be further strengthened if the position of the other two lower moving averages also line up in the required order on the higher time frames, this however is not as critical as the Ema 200.

As this is a part of my strategy, it is unlikely that you will find the following statement in any stock market education or technical analysis write up…

“It is very important that all 3 moving averages on your trading time frame and as shown in my charts comply with the strategy’s correct stacking order, if not, you must not trade!”

The position of the Ema 200 on the highest time frame selected is the one that must be manually drawn on the lower trading time frame.

You will notice that the existing Ema 200 on the trading time frame does not line up with the manually drawn one from the 1 hour chart, the manually draw Ema 200 gives a more precise picture of the major trend direction and this manually drawn moving average is the one that must be used and respected for your trade analysis.

The Video demonstrates as in the charts above just one aspect and benefit of using a multple time frame, a method to determine the underlying strength of the market.

I have two methods of trading multiple timeframes, the other is a simplified version...click here

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