Multiple Timeframe Indices Analysis in Indices Trading
Multiple timeframe indices analysis equals using 2 indices chart timeframes to trade indices - a shorter indices chart time-frame used for trading & a longer indices chart time-frame used to check the stock indices trend.
Since it's always good to follow the indices trend when indices trading, in Multiple Chart Timeframe Indices Analysis, the longer indices chart time-frame gives us the direction of the long term stock indices trend.
If the long term indices trend direction supports the direction of the smaller indices chart time-frame then probability of opening a profitable indices trade is greatly increased. This is because even if you make a mistake the long term indices trend will eventually save you. Also if you trade with direction of the trend, then mostly you'll be on the winning side - this is what this Multiple Time Frame Stock Indices Analysis is all about.
Remember there is a popular saying by many investors & traders that says: 'The indices trend is your friend' - never go against the indices trend when trading.
There are four different types of indices traders - all these different types of indices traders use different chart timeframes to trade as shown below.
Examples of how each type of Stock Indices trader uses multiple Indices chart Time Frames analysis strategy:
Indices Scalpers
Scalpers hold on to their stock indices trades for only a few minutes. Scalper indices trader never holds on to a index trade for more than ten minutes. With the objective of making small amount of pips profit: 5 to 15 pips.
A Scalper using 1 minute chart wants to go long, checks 5 minute chart, which looks like the one below, since 5 minute show indices trend is going up, then decides from this technical analysis it's okay to buy.
Best Time Frame for Scalping Stock Indices - Multiple Timeframe Indices Analysis in Indices Trading
Best Time Frame for Day Trading Indices
Day indices traders hold on to their open stock indices trades for a few hours but not more than a day. With the objective of making quite a number of pips profit: 30 - 60 pips.
Stock Indices day trader trading 15 minute stock indices chart wants to go long, checks 1 hour stock indices chart, which looks like the one below, since 1 hour shows indices trend is going up, then decides from this technical analysis it's okay to buy
Best Time Frame for Intraday Trading Stock Indices - Multiple Timeframe Indices Analysis in Indices Trading
Swing Traders
Swing indices traders hold on to their open stock indices trades for a few days to a week. With the objective of making a large number of pips profit: 100 - 250 pips.
Swing trader using 1 hour indices chart wants to go short, checks 4 hour indices chart, which looks like the stock indices trading example explained and illustrated below, since 4 hour shows the indices trend is going down, then decides from this technical analysis it's ok to sell.
Best Time-frame for Swing Trading Stock Indices - Multiple Timeframe Indices Analysis in Indices Trading
Position Stock Indices Traders
Position indices traders are traders that hold on to their stock indices trades for weeks or months. With the objective of making a large number of pips profit: 300 - 800 pips.
Position indices trader using daily trading chart wants to go short, checks the weekly indices chart, weekly looks like the one below, since weekly shows the indices trend is going down, then decides from this technical analysis it's ok to sell.
Best Timeframe for Positional Trading Stock Indices - Multiple Timeframe Indices Analysis in Indices Trading
How to Define A Indices Trend
Using a stock indices trading system that has 3 indices technical indicators - Moving Averages Crossover System, RSI Stock Indices Indicator & MACD Stock Indices Indicator - & uses simple rules to define the stock indices trend. The rules are:
Upwards Stock Indices Trend
Both Moving Averages Moving Up
RSI Indices Indicator Above 50
MACD Indices Indicator Above Centerline
Downwards Stock Indices Trend
Both Moving Averages Moving Down
RSI Indices Indicator Below 50
MACD Indices Indicator Below Centerline
