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  1. #1
    Rookie Member

    How many timeframes is too many? !!!

    I'm still trying out various strategies with MT4 and trading on demo accounts, and so far my favorite "flavor" of strategy involves multiple time point analysis.

    I've been playing with multi-timeframe versions of RSI and Stochastic and taking trades whenever all timeframes show the same signal (ex. all have recent downwards stochastic crossovers from >70). I found that using two closely spaced timeframes (such as M5/M15) results in some bad signals due to ignorance of a long-term trend. However, including too many timeframes (I've tried up to 5!) results in virtually no concordant signals.

    What are some sets of timeframes that others have had success with? Does anyone skip timeframes (ex. M5/M30) or use 3+ timeframes? It seems logical to use expiries concordant with the longest timeframe used in the analysis, but I'd be curious to know if anyone follows a different school of thought.

  2. #2
    Legendry Member Okane's Avatar
    Analyzing multiple timeframes is a good choice.
    I basically watch all the timeframes, but my approach is different than yours.

    On the higher timeframes, you want to look for major support and resistance areas.
    You don't always have to wait for RSI and Stochastic to be oversold on all timeframes to enter a trade.
    You just need to find out the direction of the trend. Look at what EUR/USD did today for example.
    Price simply broke through multiple resistance areas until finally, most of the timeframes M1 up to H4 became overbought.
    So you could have taken calls when lower timeframes such as M5 and M15 became oversold when they touched support areas (previous resistance lines).
    This also depends on your expiry of choice. If you are taking 15-30 minute calls for example, then you want to see if M5/M15 and M30 are oversold
    and that RSI is moving up. If you want to take end of day expiries then of course it is a big deal if for example the H4 is oversold/overbought.
    So consider your expiry too.

    I don't suggest you skip any timeframes at all. However, if the overall price is bullish (for example), and higher timeframes are not overbought
    yet, we want to take more calls when lower timeframes become oversold. So we don't care if H4 or H1 is not completely oversold.
    But if they are overbought then maybe the bullish movement is about to end so we should not take more calls even on lower timeframes.
    Therefore we'll have to take a look at the candles, are they making higher highs? higher lows?

    I think today's EUR/USD chart is a great example, just take a look at it and take note, especially the M5/M15 chart!
    I hope I didn't confuse you, it's hard to explain everything in writing
    but I've also written an article on how to use the daily/weekly and monthly chart that I suggest you read.
    Don't think is up on BOTS yet but it should turn up shortly.

  3. #3
    Legendry Member Michael Hodges's Avatar
    3, 3 is a good number, a long term trend setting and support resistance chart, a short term chart looking for price patterns and entry and then a near term chart for signals and precise entry points.

  4. #4
    Moderator Kolyo's Avatar
    Mostly I agree with the opinion of Okane. Looking on multiple time frames is something good, but that doesn’t always mean that you have to search for confirmation of the signals on all time frames, especially with complex multiindicator strategies. I am starting with daily and weekly time frame to search for S/R levels, overall outlook – is the market in trending or ranging conditions and what is the wave structure (1-5 or A, B, C, contracting triangles). Than I moved to look at H4 chart for more precise look and than search a confirmation of entry points on H1, m30 and m15. These are my three main time frames for executing short term trades.

  5. #5
    Active Member hecky3's Avatar
    I agree with Kolyo's choice of time frames because the method I use has time cycles that can be seen on these charts. Below 15 minutes the charts are dominated more by the noise in the price so you need to use indicators based on probability and random moves. The higher times show trends in the lowest 3 time cycles, which don't always move in the same direction. This leads you to choose the expiry which best suits your strategy.

  6. #6
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by hecky3 View Post
    I agree with Kolyo's choice of time frames because the method I use has time cycles that can be seen on these charts. Below 15 minutes the charts are dominated more by the noise in the price so you need to use indicators based on probability and random moves. The higher times show trends in the lowest 3 time cycles, which don't always move in the same direction. This leads you to choose the expiry which best suits your strategy.
    as for noise, most charts below 1 day are just noise and heavily impacted by news, events, politics and seasonality.

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