All three moving averages are aligned downward. Price is making lower highs and lower lows. Look for short trades or stay entirely in cash. Do not attempt to catch falling knives.
To identify the "primary trend" and key, long-term support and resistance levels. The Intermediate Chart (The Action Setter)
A common rule is to look at a timeframe that is 3-to-5 times larger than the next one down. Example for Swing Trading:
Shannon recommends anchoring VWAP to several key points: technical analysis using multiple timeframes brian shannon
VWAP represents the , weighted by volume. Unlike a simple moving average, which treats every price equally, VWAP accounts for where the real liquidity has been transacted. As Shannon describes it, VWAP is the one indicator that provides the “Source of Truth” by incorporating both price and volume.
Find a stock in that sector.
, argues that the real edge lies in understanding how different timeframes interact. His seminal work, Technical Analysis Using Multiple Timeframes All three moving averages are aligned downward
Here is a practical, step-by-step approach to applying Brian Shannon’s multiple timeframe strategy: Step 1: Start High (Daily/Weekly Chart)
: High-probability trades often occur when price is "pinched" between two different AVWAPs (e.g., from an old high and a new low).
Key functionality
By combining these indicators across timeframes, traders can manage risk more dynamically, placing stop-losses based on the market structure of the lower timeframe while aiming for targets defined by the higher timeframe. Amazon.com: Technical Analysis Using Multiple Timeframes
: Never trade only on the short-term chart; always trade in harmony with the trend one timeframe above. 2. The Four Stages of the Market Cycle
: This is the uptrend phase where traders should be aggressive. Characterized by higher highs and higher lows. Stage 3: Distribution Do not attempt to catch falling knives
: Shannon typically monitors five timeframes: Weekly, Daily, 30-minute, 15-minute, and 5-minute. Market Context