Using Two/Three time frames - practical meaning.

We have all heard the wisdom of using multiple time frames. But what does it really mean?

For instance.. what are the rules you use in the smaller time frame compared to the larger? What if the larger time frame shows an up move and the smaller shows a down move... as an example.

(this comes from a private discussion with another trader--- so I thought I would open it up to the collective intelligence)

Lou

IMO, it's important to monitor multible time-frames at a time (that's why my second minor target is buying a multible screen monitor), I personally monitor 4 time-frames...

1. Daily: Very important at deciding the direction you'll follow, or at managing your stoploss in either direction.
2. 1hour: Detecing the minor trendlines and bounces of prices off them, MAs and so on (that's where I apply technical analysis and decide on a trade)...
3. 15m: Only for entry points, watching candelsticks and stochastics...
4. 30m: Confirmation for the 1h chart direction, sometimes I ignore it...

You can also refer to Dr. Alexander Elder's book "Come into my trading room", he uses a system called (Trible Screen System), I think it's very convenient...

Here's my 2 cents..

In my trading plan, I have 2 timeframes.. the daily and the weekly..
I use the weekly to have a better picture of a trend, then I use the daily to look for entry setups..

This is what I plan to use in my trading and this may not be the case to others..

P.S.
Or you can refer to meedo's post for more details...

IMHO, I think multiple time frames means "Multiple Time Frames" lol...

When you watch different time frames, you are actually watching the market in different modes..A long term chart shows you the larger mode of the market and so on...

Can you track a Tennis players points???

There is always a match, sets, games and points in any given tennis match...

Each player collects as many points as he/she can, then accumulating those points, they accumulate games, then they accumulate games to accumulate sets, and finally they accumulate sets to win the match..

With the little difference that there is no match in the market to be won eventually...

Shorter time frames are like the points in a tennis game, moderate or medium term charts are like the games and longer term charts are like the sets of the game...


Thanks,

Nader

you cannot trade using one time frame. i will not work. i have seen some folks say that to enter a weekly set-up you need to have a SL of 100 pips . lol . how now ? you can still enter with a SL of 50 pips and till enjoy your weekly set-up. you do that by going to lower time frames and putting your SL there

Wow! This is an old thread, but I wanted to respond anyways.

One can absolutely trade using a single time frame.

A chart never lies.
If A chart never lies, then we can say, that ALL charts tell the truth.
If ALL charts tell the truth, then there is no need to look at more than one of them.

The simple concept that seems to escape so many is that trading can be boiled down to: WHAT you want to see, WHERE you want to see it.

Take a look at the first chart below.

This is an example of WHAT you want to see- the FVB. Where you want to see it- within a Supply/Demand Delta Zone. No other time frame needs to be consulted.
Whatever is happening on the 15 minute or 4 hour chart have no baring on this trade. Everything one needs, is on the one chart. With that said, one can use multiple time frames as such.

Take a look at the second chart below.

This is a 15 minute chart. Note that there is no signal shown in the Supply/Demand Delta Zone. Since we know that we are in an area where we would like to see a trade signal, we could move down to the 13 minute or 12 minute or maybe even the 5. If we see a valid signal pattern on one of those time frames, we could take it. We already know that the signal would be appearing in a valid area. But this is a more advanced price action trading strategy and not necessary. One could choose not to go up or down time frames to find the signal and simply trade the one chart. Trades would be missed, but there will always be others...........