- Action: Look at the weekly chart. - Question: Are the moving averages sloping up (Markup) or down (Decline)? Step 2: Identify the Value Zone - Action: Drop to the daily chart. Is the stock pulling back to the rising moving average? - Rule: Do not buy if the stock is extended far away from the moving average. Step 3: Use the Lower Timeframe for Precision - Action: Look at a 15-minute or 60-minute chart. - Signal: Look for a reversal pattern (a bullish engulfing candle or a break of a small falling trendline) inside the value zone identified in Step 2. Step 4: Manage the Trade - Stop Loss: Place the stop just below the recent swing low on the lower timeframe or below the Anchored VWAP. - Profit Target: Look towards the next resistance level on the higher timeframe.
Multiple timeframe analysis involves monitoring the same financial asset (such as a stock, crypto, or forex pair) across different chart granularities. Shannon emphasizes that no single timeframe tells the whole story. Instead, traders should look at the market through three primary lenses: - Action: Look at the weekly chart
Look for a brief pullback or a sideways consolidation pattern on the daily or 60-minute chart. This consolidation represents a low-risk entry opportunity within the broader uptrend. Step 3: Trigger the Entry (Intraday Chart) Is the stock pulling back to the rising moving average
This comprehensive guide explores the core concepts of Shannon's multiple timeframe analysis, details the market cycles you must know, and explains how to structure your charts for maximum profitability. The Core Philosophy of Multiple Timeframe Analysis - Signal: Look for a reversal pattern (a