The main reason that so many traders use multiple time frames in their trading is because it gives their trades a level of confluence. When trading with one time frame only, that is all the information you have. When using multiple time frames, you start to build a really clear picture of the overall price action story.

In the example below, we can see that the daily chart price is in a trend higher. We can also see that price has pulled back lower into an important support level. The second chart below shows the same pair; however, this is the 1 hour time frame. We could use this smaller time frame to look for a better entry signal to go long that would give us a tighter stop loss.

In this example, the price has formed a bullish engulfing bar at the daily support level inline with the daily chart trend. The reason for this is because you normally want a higher time frame, such as the daily or weekly time frame that shows you the overall price action picture.

You then want an intraday time frame such as the 4 hour or 1 hour time frame that shows you what has been happening on the intraday charts.

And lastly, you want a smaller time frame that will help you find the best trade entries. These time frames are normally smaller time frames like the 30 minute and 15 minute time frames. The higher time frame, such as the daily chart, will show you a clear picture if the price is in a trend or ranging and will have fewer false signals.

As you start to move to lower time frames, there will be more noise on your charts and many more false signals. If you can combine the higher time frames with the lower time frames, you can start to get a really good idea of where the market is looking to head next. You can also start to make tight entries.

One of the letdowns of most trading platforms is that they do not allow for indicators to be easily used across multiple platforms. For example, if you want to see what a moving average is doing on the 1 hour chart, then you have to move to the 1 hour chart. When multiple time frame trading, it can be convenient to see what is going on with other time frames without moving to them.

For example, if analyzing a Forex pair on the daily chart, it can be convenient to know what a certain moving average is doing on the 1 hour chart without moving off the daily chart. Whilst it is not built directly into their charts, MetaTrader allows you to install and use some free custom indicators that will let you do exactly this. Some of the popular ones are moving averages, RSI, and stochastic that can all be used when multiple time frame trading.

You can checkout some popular multiple time frame trading indicators here. One of the best strategies when multiple time frame trading is to trade with the higher time frame momentum and use the smaller time frames to pinpoint your entries. As an example, there are three charts of the same Forex pair below, the daily, 4 hour, and 30 minute chart.

In the first daily chart, we can see the price starting to break higher with the trend and through an important resistance level. On the second chart that is the 4 hour time frame, we can see that price has confirmed this breakout with two large bullish candles. With different information on different brokers, different results appear.

Hence, one winning strategy on one broker might prove disastrous on another. An hour is an hour around the globe: it starts at the top of the hour and sixty-minute later the candlestick closes. Believe it or not, brokers use various tricks to alter the information, so they get an edge from everything possible.

The solution to the problem listed above is to use the same server time on all of your analysis. Simply ask the broker to provide you with the right charting info. For instance, the best charting info comes from the GMT timeframe.

Pure and simple, the GMT pricing is the unaltered one. Now, go try to find a broker listing GMT prices. The H4 on a GMT pricing shows one crucial piece of information: the daily, weekly, and monthly fixings. For those not familiar with the concept, every four-hour during the day the clearing on futures markets result in a rise in volatility on the spot market.

Moreover, it is even more important when it comes at the end of the trading week. Furthermore, it is vital at the end of the trading month. The key is to sit with institutional players, their interest, and focus. And that info is better seen on the H4 chart.

With, obviously, one condition: GMT prices. I would always prefer the info provided by the daily chart than any other timeframe. Perhaps only the H4 during fixing times is equally as important as the daily chart. That is, again, if you use GMT prices. The closing of such candlesticks is crucial from interpreting the future price action.

Is it a Doji candle, a hammer pin bar or shooting star? Does it have a short or long shadow? How about the real body? Can we get any meaningful information from its size?

Most of these things happen during the last moments in a daily candlestick. Takeaway from this section: Never expect or predict- always react! Such charts represent the frontier between investing and swing trading. Rarely swing traders look at daily timeframes, just as rare as investors look down at a daily chart. A funny story about brokerages again, if I may. Recently read here in the last few years , most brokers around the world gave up on the Sunday candlestick.

As you may know already, for a couple of hours or so, trading takes place in New Zealand. Because of that early New Zealand trading hours, it means Sunday for the rest of the world i. Europe, North America price action must reflect on the charts. The time element plays an important role when trading with the Elliott Waves Theory. In fact, often traders using the time factor simply count the daily candlesticks to validate an entry or exit.

After all, traders have the responsibility of choosing what fits best to their trading style and analysis. Plenty of stores sell jeans, probably the same brand, and it is your choice from which store to buy.

The same applies here. As mentioned earlier, a multiple timeframes analysis is a top-down analysis. It offers a clear picture of how the price action unfolds as economic news and events pour in. More precisely, how the market digests the daily information, making it tradable or not. Again, brokers close the weekly price action at different times. How do you know which one is the relevant one?

But the monthly chart is a blast. So pure in the info provided that all the economic news and noise provided by the media outlets simply disappears. Historical data comes in yearly charts and sometimes has secular information. In the meantime, however, make sure you have GMT prices on your MT4 or whatever the trading platform used. With the steps above in mind, use the same strategy on all timeframes.

On the same currency pair, you may have different outcomes: bullish on H4, bearish on monthly, bullish on H1. Or the other way around. If hedging is allowed, try taking them on a Demo to test first. If not, use different brokers: one to analyse the market and take one side of the market, and the other one to trade the other side of the market.

The same is valid for any other trading strategy, like the Elliott Waves, and so on. Whatever strategy you use, keep one thing in mind: a multiple timeframe analysis always begins with the biggest possible timeframe and ends with the smaller timeframe.

Perhaps this is not quite the article you were expecting to read about timeframes. I bet a lot of info here is new for many of you. But the purest form of interpreting price action comes from having different market perspectives. Because brokers are responsible for the information presented, we must rely on that.

However, as pointing out during this article, not every time brokers offer the most reliable information out there. Historical prices will help you more than you can imagine. Multiple timeframes analysis is complex. But it clears the way to proper market interpretation. ColibriTrader was right when he said this article was not what I was initially expecting. Much new information that most traders have not even thought about beforehand is revealed herein.

Well worth the read. Thanks for pointing all this out to us all. Thanks Ed! I am happy that you are finding this article useful! I am looking forward to writing the next one that can help you better understand this subject! It is quite important, as well! I have mentioned it in the article. It all comes down to the confluence of timeframes.

Your email address will not be published. Save my name, email, and website in this browser for the next time I comment. Disclaimer: Any Advice or information on this website is General Advice Only - It does not take into account your personal circumstances, please do not trade or invest based solely on this information. By Viewing any material or using the information within this site you agree that this is general education material and you will not hold any person or entity responsible for loss or damages resulting from the content or general advice provided here by Colibri Trader Ltd, its employees, directors or fellow members.

Futures, FOREX, CFDs, and spot currency trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures, FOREX and CFDs markets. Don't trade with money you can't afford to lose.

Multiple timeframes analysis, one of the most complex ways to look at markets, has never been easier. Back in the day, traders tracked charts using pen and paper. While an accurate method, it involved plenty of time and resources wasted. A complete multiple timeframes analysis in Forex trading always starts with the bigger timeframe first.

Such an approach has multiple advantages, but the main one is that it offers a clear picture of the market. I will provide a plenty of reasons to support it. Swing traders enjoy the hourly and four-hour timeframes setups. And, investors keep an eye on the bigger timeframes.

Or, why not trade different styles on different trading accounts? Finally, a multiple timeframes analysis keeps the trader on the right side of the market. It also does filter the noise on the lower timeframes. With this article, my aim is to introduce the power of using a multiple timeframes analysis in your trading. A warning from the start: it is a complex but rewarding process for the dedicated trader!

As a price action trader , multiple timeframe analysis fits my trading style perfectly. By offering an unbiased, overall picture, it builds an equilibrium point between different time perspectives. Like it or not, timeframes have different importance in the day-to-day market analysis. For instance, what is the one-minute chart telling you? Or, more precisely: does it offer meaningful information? The MT4 or the MetaTrader4 platform comes with the following standard timeframes by default:.

All of them are important for different stages of a multiple timeframes analysis. However, depending on the trading platform, traders have access to other timeframes too. For instance, the M2 two-minute chart or H2 two-hour chart exist, and some traders use them when doing technical analysis. As always, keeping things simple helps. Therefore, scalpers value highly this information in their trading strategy.

At best, traders use it for scalping their way during illiquid trading sessions. Asian traders love it. Because the Forex market stands still most of the Asian sessions, traders active during the Asian session have a hard time catching swing trades. As such, they move to the lower timeframes like M1 and use oscillators to buy the lows and sell the highs of the session. As such, traders using M1 most of the times end up wasting both precious time and resources trading on a dangerous timeframes.

That is if trading is manual or with Expert Advisors. Quant firms love such timeframes. In fact, they go even below M1, trading for the 7 th , 8 th or even 9 th decimal of a quote.

But again, from a multiple timeframes analysis, M1 is useless for the inexperienced. As, in fact, are all other timeframes that start with the letter M. They all share the same risk and provide little or no information as to where the market actually goes.

Hence, a multiple timeframes analysis starts at the H1 chart. Perhaps you all wonder why multiple timeframes analysis stops at the H1 chart and not starting with it.

The answer is that a true multiple timeframes analysis is a top-bottom, not a bottom-up analysis. As such, it begins with the highest timeframes possible ideally multi-year charts and goes lower to the smaller ones. And yes, it preferably stops at the hourly chart. Coming back to the H1 chart, it is one of the most important timeframes of them all. The answer comes from its simplicity, as brokers cannot alter that much the information provided.

Let me explain why in more details. Broker houses around the world have their servers placed in various locations. Cost considerations make a broker from the United Kingdom to place the servers in Ukraine, for instance, or one from the United States to have their servers in Asia.

Because of that, the charts show different information on almost all bigger timeframes. Candlesticks simply start at different times. The two hours difference between the two physical locations will reflect differently in a four-hour chart. The same holds true with a daily chart: the daily candlestick starts and closes with a lag of two hours. Imagine you trade simply from a technical analysis perspective. As such, opening and closing prices are vital.

With different information on different brokers, different results appear. Hence, one winning strategy on one broker might prove disastrous on another. An hour is an hour around the globe: it starts at the top of the hour and sixty-minute later the candlestick closes.

Believe it or not, brokers use various tricks to alter the information, so they get an edge from everything possible. The solution to the problem listed above is to use the same server time on all of your analysis. Simply ask the broker to provide you with the right charting info. For instance, the best charting info comes from the GMT timeframe.

Pure and simple, the GMT pricing is the unaltered one. Now, go try to find a broker listing GMT prices. The H4 on a GMT pricing shows one crucial piece of information: the daily, weekly, and monthly fixings. For those not familiar with the concept, every four-hour during the day the clearing on futures markets result in a rise in volatility on the spot market. Moreover, it is even more important when it comes at the end of the trading week. Furthermore, it is vital at the end of the trading month.

The key is to sit with institutional players, their interest, and focus. And that info is better seen on the H4 chart. With, obviously, one condition: GMT prices. I would always prefer the info provided by the daily chart than any other timeframe. Perhaps only the H4 during fixing times is equally as important as the daily chart. That is, again, if you use GMT prices. The closing of such candlesticks is crucial from interpreting the future price action.

Is it a Doji candle, a hammer pin bar or shooting star? Does it have a short or long shadow? How about the real body? Can we get any meaningful information from its size? Most of these things happen during the last moments in a daily candlestick.

Takeaway from this section: Never expect or predict- always react! Such charts represent the frontier between investing and swing trading. Rarely swing traders look at daily timeframes, just as rare as investors look down at a daily chart. A funny story about brokerages again, if I may.

Recently read here in the last few years , most brokers around the world gave up on the Sunday candlestick. As you may know already, for a couple of hours or so, trading takes place in New Zealand. Because of that early New Zealand trading hours, it means Sunday for the rest of the world i. Europe, North America price action must reflect on the charts. The time element plays an important role when trading with the Elliott Waves Theory.

In fact, often traders using the time factor simply count the daily candlesticks to validate an entry or exit. After all, traders have the responsibility of choosing what fits best to their trading style and analysis. Plenty of stores sell jeans, probably the same brand, and it is your choice from which store to buy.

The same applies here. As mentioned earlier, a multiple timeframes analysis is a top-down analysis. It offers a clear picture of how the price action unfolds as economic news and events pour in. More precisely, how the market digests the daily information, making it tradable or not. Again, brokers close the weekly price action at different times. How do you know which one is the relevant one? But the monthly chart is a blast.

So pure in the info provided that all the economic news and noise provided by the media outlets simply disappears. Historical data comes in yearly charts and sometimes has secular information. In the meantime, however, make sure you have GMT prices on your MT4 or whatever the trading platform used. With the steps above in mind, use the same strategy on all timeframes.

That is where our TOFTEM model steps in. My goal is to get as many pips as possible and help you understand how to use indicators and price action together successfully in your own trading. The chart below shows how: HOW TO ACTUALLY TRADE THE EMA FOREX TRADING STRATEGY the best way to enter a trade is to use price action by the use of reversal candlestick patterns. This ForexWOT Multi Signals Swing Trading Strategy makes less trades per month for currency. using the 4H as the opportunity chart, the entries could be the trigger chart on 15M or 5M 1 time frame lower or 4H the opportunity chart.

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