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Multiple Time Frame Price Action

Updated on September 10, 2014

MTF Price Action Indicator

Price Action is the undisputed most important fact in trading. If price action is the key then using price action on 8 time frame at once must be the greatest trading "edge" possible. It is if you have the right approach to understand 8 different time frames at once.

TradeStation Multiple Time Frame Price Action Is The Greatest Trading "Edge"

MTF Price Action Indicator

Most traders agree that price action is the single most important factor in trading. Trading against price is account suicide and a sure fire way to lose money. If you trade based on the way you believe the market is going to behave and you're trading against price, the market will take your money away. Price action is the most critical fact that you can understand as a trader and the greatest trading "edge" is price action across multiple time frames (MTF).

The typical approach to multiple time frame price action is difficult. Many trading authors teach you to start with a chart, like the daily, and you look at the direction of the price on the daily. For this example we'll say it is in a long trend. Next, you study the hourly chart and look to see if your indicator gives you the signal to make a long trade. After the hourly chart confirms a long trade, you go to the 5 minute chart. You now use the 5 minute chart to refine your long entry point and decrease your stop loss risk. It's on the 5 minute chart that you can see a fine tuned movement of when to make the entry into the long.

So, the decision was initially set up because the daily was in an upward trend. Secondly the hourly gave you the signal to make the trade. The 5 minute was nothing more than a refinement of the long entry to reduce the amount of stop loss risk in your trade. Now, this is a good process, but if you are like most traders you'll find flipping back and forth between 3 different charts is a laborious process - and it's not even necessary.

With the creation of a single MTF price action indicator, you have the ability to see 8 different time frames all in one single indicator. This single MTF indicator shows the interaction of all 8 different time frame price actions. Now, instead of flipping charts, you can look at one single indicator on your trading chart and see the price action direction of 8 different time frames.

Why is this 8 different MTF price indicator such a powerful trading "edge"? First, it eliminates flipping across 3 charts to get a 3 time frame approach in your trading. It gives you access to 8 different time frame's price action right on a single trading chart. Secondly, and this is critical, you might be trading on a 1 minute or 5 minute chart to reduce your stop loss risk when making your entries, yet you are not trading the market noise on this short chart. You are making your trades based on price action of the 7 higher times.

You will no longer have to go look at the daily chart for price direction, and then look at an hourly chart for the entry signal, and then switch to a 5 minute chart to make your trading entries. When you have the MTF price showing on your trading charts, it's easy. All of this information in one single indicator and shown right on your trading charts is a very powerful way to improve your trading. The greatest trading "edge" of all is using multiple time frame price action.

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Knowing the Stock Market Direction

What do you think about price action on multiple time frames?

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    • profile image

      anonymous 

      7 years ago

      This a rare condition and time will improve. Cool lens!

    • profile image

      anonymous 

      7 years ago

      Unfortunately, one time I personally had this problem myself.

    • profile image

      anonymous 

      7 years ago

      You can also look at the time frames of the same currency pair to make better and more educated decisions on which time frame to go with depending on the currency pair in the trade.

    • profile image

      sharongreene9100 

      7 years ago

      This provides you with the best possible time for trading.

    • profile image

      anonymous 

      7 years ago

      You can choose the specific time frame that works best with the traderâs personality.

    • profile image

      ruthscott1940 

      7 years ago

      You should try to focus on just one time frame, and you can find out how and which one works the best for you.

    • profile image

      skincare2011hill 

      7 years ago

      You should be able to use the multiple time frame analysis to your benefit while trading which helps you gain money in the long run instead of running around blind not knowing which time frame is best.

    • profile image

      donna77lopez 

      7 years ago

      You can decide based on which time frame works best for you.

    • profile image

      anonymous 

      7 years ago

      You will then want to try to ignore the other time frames.

    • profile image

      anonymous 

      7 years ago

      You will want to stick with just one time frame to eliminate any confusion that might come along with jumping from time frame to time frame.

    • profile image

      jentayloritaly 

      7 years ago

      This is because the traders will see the sell signal on the trade in the 4 hour, and then hop over to the 1 hour and see that the price of the trade is slowly but surely moving up at the same time.

    • profile image

      wbrowncompany 

      7 years ago

      This also can complicate the trading market because the trades can sometimes become confused when looked at in the 4 hour time frame.

    • profile image

      mikejonesy04 

      7 years ago

      This also can complicate the trading market because the trades can sometimes become confused when looked at in the 4 hour time frame.

    • profile image

      barbaraseptmoor 

      7 years ago

      Since the times basically meet at a certain point, even though one is trading on the 4 hour chart, the other trader might be on the one minute, and in this case they can both be right because of the hours difference and the changes in the up and downs for the trade.

    • profile image

      barbaraseptmoor 

      7 years ago

      Whatâs more is that all of the traders can be correct on their opinions.

    • profile image

      lindawilson08 

      7 years ago

      Different traders are able to have different opinions and feelings on how a pair is being traded because of the different time frames.

    • profile image

      pattymilerbusiness 

      7 years ago

      It is the process of looking at the same pair and price, but looking at them using different time frames on the market.

    • profile image

      jamessmith2123 

      7 years ago

      It is a simple process, even though it sounds more complicating and confusing that it is.

    • profile image

      girliemaryweightloss 

      7 years ago

      Knowing how to analyze the different time frames can become handy when trading in the Forex market.

    • profile image

      robert2011williams 

      7 years ago

      It is a simple process, even though it sounds more complicating and confusing that it is.

    • profile image

      jjohnsonamsterdam 

      7 years ago

      Knowing how to analyze the different time frames can become handy when trading in the Forex market.

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