welcome to the video on trading
multiple time frames, a very very
important topic so one of the reasons
that using multiple time frames is very
important is because when you have to
time frames of that a line that give you
a goodbye signal or good cell signal
concurrently you have a higher
probability of a winning trade
why is that there's a market logic to it
the market logic is that you have some
people looking at one time frame for
example here we have the daily chart you
can see that can you
alright let me bring that down for you
sorry about that
mm okay there we go and so there we go
so this is the spiders but the point is
this is a daily chart so you'll have
some people for example looking at a
daily chart and trading off of that so
that's one group of market participants
that are looking for signs so a sign
that would be a pretty obvious one that
a lot of people trade is the market
coming up breaking through this
resistance level here coming back down
and resistance than becoming support in
the market going up that's a very
traditional technical analysis thing for
people to be watching and especially
when it's a significant support or
resistance level and that one is because
if you go over here you'll see that that
level is off of these highs these major
highs here which basically a Triple Top
1230 mark that for you
easier to see if I'm market I've had
people tell me that so there's 1 2 & 3
so Triple Top trading pattern by the way
i did a video on that too on youtube if
you want to read about triple tops or
triple bottoms and so a lot of people
have looked at this and the more people
who see something the more people
respond to it in the future and more
people to respond to it
well that means you get more people
buying more people selling in therefore
it's more likely to be a self-fulfilling
prophecy and that's really how markets
work is it's a big auction place and the
more people
that are buying selling as basic supply
demand and so that high then it's gonna
be one that a lot of people seem so
again when people see this very basic
technique i mean even people who aren't
real strong technical analysts will look
at that and they'll know they'll mark
that hi there and they can be watching
how the market responds to that previous
high market bounces off that they're
going to be barracks we're gonna have
some people who will take profits into
that which is probably why you have that
one red bar there and market goes above
it and then comes back and says well
wait a minute let's see
are we really serious about that we got
above it and going to have people be a
little skittish and when it moves back
up even hear you see these bars here for
example these bars are a bit of a
hesitation or thing you gotta do g bar
again narrowest part of the narrow range
park until we break above the high of
this bar and then he get your big
candlestick and that's when the market
has a real extra confidence so this is
your first significant move and then
they're in their step 3
ok now the problem is so that yes that
is a great pattern we love it
however the challenge here is if we take
this trade based on the daily chart
we're getting in about half way past the
move from this load of that high in fact
even less and then that high and now
we're all the way back down here so it's
a late entry as far as I'm concerned and
so the problem is the reward on it is
not that great and we want not only a
high wind loss ratio that's got a pretty
good high weight loss ratio on that type
of trade but it's not a great risk
reward ratio it's not too bad but it's
not stellar we want to better reward to
risk ratio so how do we get a better
reward to risk ratio well the same
answer we use multiple time frames so
let's bring up a longer timeframe in
this case a daily chart in this case a
weekly chart
it's not the weekly chart on the right
in the daily chart on the left so call
the daily the shorter time frame that we
clean the longer time frame now we have
a my setup over here on the weekly as
well right in this area here so trend is
up as the 50 period simple moving
average gotta wave 1 and a 2 so that's a
first retrace in the trend and then we
getting very nice three-bar candlestick
pattern for a bullish signal by the way
this black lines the 15 p.m. a now is
that comes in you see early November so
it comes in around this time right in
here really November what happens on the
daily chart well we get a gap up boom
nice big gap
ok let me bring my crosshairs on here so
if I global cross hearers you can see
where these match up there we go so
let's just do it this way here
ok so now you can see we got in a lot
earlier or we could have potentially
gotten a lot earlier if we would have
looked for the setup on the weekly chart
instead of the daily now we want a good
signal good trigger if you will on the
daily chart as well but we're primarily
looking for the setup on that the longer
term chart by the way i'm using daily
and weekly charts but this can apply to
any to time frames you can use a hourly
chart for our chart or shorter time
frames if you want to as well so the
point is looking for the setup on the
longer-term chart now but that does okay
look where we are here with our
crosshairs if I can keep that they're
not with mine drawing tools here but
it's going to work but here was our our
entry before remember breaking above
resistance and retracing back to support
and so we got in here about i'll say
somewhere around 220 or so now we're
able to get down were able to get in
here somewhere around let's say 2 14 to
13 14 15 somewhere in there depending on
where you would actually take your entry
and oh my goodness look at that you've
doubled your profits roughly so and you
know that's where it's gone so far so
our initial reward if you would have
taken the setup on the daily chart is
that your reward if you took it on the
weekly chart is that Plus that huge
difference huge difference
so in this case about double and so
therefore I like to always look for
setups on the longer-term chart and then
look for triggers on the shorter term
chart so that i get a superior
risk-reward ratio i also find as we said
at the beginning of the video it also
increases my win-loss ratio now the one
thing that I will say as the downside of
this approach is that you don't get as
many trades and that's just a logical
thing okay waiting for trades on the
longer-term chart
well they're just not going to be as
many trades because there's not as many
bars in the same period of time and so
the one of the ways to resolve that is
simply be trading more markets have a
variety of markets that you trade i
would trade a lot of anti do trade a lot
of non-correlated markets so that i get
a lot of opportunities on the
longer-term chart so very very important
principle and one other thing that I
would say to is timing is absolutely
critical so might as well how would you
know to get in here of course that's a
five-way pattern that your average trend
so trend reversal there was to be
expected also timing indicator would
indicate that if you're interested my
timing indicator to give away that for
free on a webinar training how to use it
and give it to you offer free to send me
an email at period top dog training calm
and i'll be happy to send you over that
info but timing is absolutely critical
and then again treating with the trend
over here on the long-term chart and
trend reversal after five wave pattern
here is actually an alignment of trade
entries they're just different signals
but they're still both long signals if
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