Our previous post discussed the use of multiple time frames – I use three different intra-day time frames for trading purposes.

Our slowest intra-chart – we call it our primary – is used for determining the prevailing trend for the trading day. We often construct trades on this chart for some markets.

The secondary intra-day chart is most often used to construct trades. If the trend on that chart is in the same direction as the trend on the primary chart- and both trends are strong – we will only trade in that direction.

If the trend on the primary chart is weak we will take a trade in either direction, keying our trade off the trend of the secondary chart.

The fastest chart is used for two main purposes: First – and most often – I like to watch the fastest chart when entering and exiting a trade constructed on the secondary chart – hoping to improve by entry and exit by a tick or so keying them to the price movement on the fastest chart. Secondly, when I want to do scalping – ultra-short term trading, I construct trades on the fastest chart.

The best short term trades are made at points where price is making a change in trend direction on the primary intra-day chart. Trend always changes direction first on the faster charts so they provide early warning of trend change on the primary chart,

Using multiple time frames gives me a better feel for the tempo of the market.

Learn all about these trading techniques and much more in our eBook, See the Music of the Market.

 

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See the Music of the Market

The unique trading method that is Trading Between the Lines