Enter the trade only when the micro-trend aligns with the macro-trend. 4. Integrating the Volume Weighted Average Price (VWAP)
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Using multiple timeframes in technical analysis offers several benefits, including:
Used to identify the dominant trend and primary support or resistance levels. Enter the trade only when the micro-trend aligns
Drop down to the 65-minute chart. Wait for the stock to experience a brief pullback or consolidation within its larger uptrend. The ideal setup occurs when the price pulls back to a rising 20-period moving average on this timeframe. Step 3: Execute on the Lower Timeframe
: Used to pinpoint entries and exits (e.g., 5-minute or 1-minute charts).
A unique hallmark of Shannon's modern technical approach is using Anchored VWAP (AVWAP). Standard indicators change based on the chart interval, but Anchored VWAP provides a continuous benchmark across all timeframes. This link or copies made by others cannot be deleted
To summarize the book's methodology into a concrete checklist:
Brian Shannon’s Technical Analysis Using Multiple Timeframes
Stay in cash, look for shorting opportunities, or wait patiently for a new Stage 1 setup. 3. How to Set Up Your Multi-Timeframe Chart Layout Try again later
Brian Shannon's approach to technical analysis using multiple timeframes involves analyzing a security's price action across different timeframes to identify trends, patterns, and potential trading opportunities. Shannon advocates for using at least two to three timeframes to get a comprehensive view of a security's price action. He also emphasizes the importance of using a combination of technical indicators and chart patterns to confirm trading signals.
Dictates the long-term structural trend.
A signature concept popularized by Brian Shannon is the use of the . Unlike traditional moving averages, the AVWAP allows traders to anchor a volume-weighted price line to a specific psychological event, such as: Earnings releases All-time highs or lows Major gap-up or gap-down days