Multiple Time Frame Questions

N

neksor

Hi there,

As a neophyte in trading, I would like to hear how some of you guys use Multiple Time Frame Analysis in your trading. So far I have in mind that it could work as a trade filter where by to enter on minute bars when px/MA crosses on daily bars etc etc.

Additionally, how would one represent a higher time frame? (i.e daily bar could be represented by a 480 minute bar for an 8 hour trading session or a daily bar)

Or should I solely focus on the trend within the time frame which I am trading on only because when I throw in a higher time frame into the system I get less trades and am afraid I adding the sum of moving parts leading to additional curve fitting.

Would like to hear from other traders in how they would use multiple time frames in their trading. Thanks.
 
Quote from neksor:

Hi there,

As a neophyte in trading, I would like to hear how some of you guys use Multiple Time Frame Analysis in your trading. So far I have in mind that it could work as a trade filter where by to enter on minute bars when px/MA crosses on daily bars etc etc.

Additionally, how would one represent a higher time frame? (i.e daily bar could be represented by a 480 minute bar for an 8 hour trading session or a daily bar)

Or should I solely focus on the trend within the time frame which I am trading on only because when I throw in a higher time frame into the system I get less trades and am afraid I adding the sum of moving parts leading to additional curve fitting.

Would like to hear from other traders in how they would use multiple time frames in their trading. Thanks.
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I use at least 3 time frames when i trade. For day trading the 60 min is used to identify all the key areas. Then i swill use a 15 min to get a signal around those key areas and then i use a 5 min along with a 1 min to pinpoint my entry as best i can. the 5 min will also confirm if the signal is for real.
 
Quote from Truff:

I use at least 3 time frames when i trade. For day trading the 60 min is used to identify all the key areas. Then i swill use a 15 min to get a signal around those key areas and then i use a 5 min along with a 1 min to pinpoint my entry as best i can. the 5 min will also confirm if the signal is for real.
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just a quick note re 60 min charts. i learned this from brian shannon of alpha trends - a 60 min chart is inferior to a 30 min chart b/c there are not a whole number of 60 min periods in a 6.5 hr trading day so the first "hour" is really only 30 mins of trading. just my 0.02 USD.
 
Most traders use multiple timeframes to reduce risk when entering trades in desired areas, and although this is partially benefitial, to some extent, this not where the true power of using multiple timeframe lies.
 
Quote from FrankSlaughtery:

just a quick note re 60 min charts. i learned this from brian shannon of alpha trends - a 60 min chart is inferior to a 30 min chart b/c there are not a whole number of 60 min periods in a 6.5 hr trading day so the first "hour" is really only 30 mins of trading. just my 0.02 USD.
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Thats if you trade stocks. I dont trade stocks, i trade FX and futures
 
Quote from FrankSlaughtery:

just a quick note re 60 min charts. i learned this from brian shannon of alpha trends - a 60 min chart is inferior to a 30 min chart b/c there are not a whole number of 60 min periods in a 6.5 hr trading day so the first "hour" is really only 30 mins of trading. just my 0.02 USD.
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Tell Brian it depends on your software and/or data provider as to whether the first 30mins makes the bar or if it continues for 60 mins.

But apart from that, why confine yourself to regular hours when Globex is available?
 
Quote from Xspurt:

Tell Brian it depends on your software and/or data provider as to whether the first 30mins makes the bar or if it continues for 60 mins.

But apart from that, why confine yourself to regular hours when Globex is available?
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i agree. if you're trading fx, futures then ignore what i said.
 
Quote from Daring:

Most traders use multiple timeframes to reduce risk when entering trades in desired areas, and although this is partially benefitial, to some extent, this not where the true power of using multiple timeframe lies.
More...

Thanks guys for the replies, Daring - would you care to share a little more if possible on how you would utilize multiple time frames.

I currently have 2 simple thoughts in mind on how they could be used:

A) Dual or Triple time frames e.g MAs of differing lengths
1) Longest time frame for trend confirmation,
2) Intermediate TF for signal generation against the longest TF
3) Shortest TF for risk management i.e (trailing stops, reversals).

B) Time frames of differing granularity
Smaller time frames respect S/R levels of larger time frames. In this case only 2 time frames are used. e.g Daily to enter trades vs Weekly charts.

Plsd to hear any other view / opinions on MTTF analysis thanks!
 
Quote from neksor:

Thanks guys for the replies, Daring - would you care to share a little more if possible on how you would utilize multiple time frames.

I currently have 2 simple thoughts in mind on how they could be used:

A) Dual or Triple time frames e.g MAs of differing lengths
1) Longest time frame for trend confirmation,
2) Intermediate TF for signal generation against the longest TF
3) Shortest TF for risk management i.e (trailing stops, reversals).

B) Time frames of differing granularity
Smaller time frames respect S/R levels of larger time frames. In this case only 2 time frames are used. e.g Daily to enter trades vs Weekly charts.

Plsd to hear any other view / opinions on MTTF analysis thanks!
More...

You look at bigger TFs to determine the potential of your signals. Perhaps your scalp has now become an intraday swing, perhaps your intraday swing was rejected and it has now become a scalp, and so forth.

You ask a complex question that requires years of study, was merely suggesting to look beyond micro risk.
 
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