Technical Analysis Using Multiple Timeframes Brian Shannon Guide

Wait for the lower timeframe to confirm the move on the higher timeframe. For instance, if the daily chart shows a pullback to the 50-day MA, look for a "higher low" or a "breakout" on the 60-minute chart 1.2.2. 5. Summary of Benefits

Stage 2: Markup (Bull Market) /\ /\ / \ / \ / \_____/ \ / \ Stage 3: Distribution (Top) / \_______/---\ Stage 1: Accumulation (Base) \ _/\_/\___/ \ Stage 4: Markdown (Bear Market) \ /\ \ / \ \____/ \ Stage 1: Accumulation (The Base)

5-minute, 2-minute, or 1-minute chart. Used to spot immediate volume surges and momentum shifts for entries. 4. Integrating Moving Averages and Anchored VWAP

Wait for confirmation. Buy when the ribbon turns green and price reclaims VWAP—even if that means buying at a higher price. Confirmation is always worth more than hope.

Shannon is known for monitoring : a weekly chart, a daily chart, a 30‑minute chart, a 15‑minute chart, and a 5‑minute chart. This stack allows him to see the interplay of bigger trends with shorter‑term price movements—a relationship that single‑timeframe traders completely miss. technical analysis using multiple timeframes brian shannon

The higher timeframe (Weekly and Daily charts) defines the "weather." It tells you whether the market is in a bull or bear phase. Shannon emphasizes that a signal on a lower timeframe does not automatically override a higher timeframe trend. If the weekly chart is in a downtrend, a bullish setup on the 15-minute chart is likely just a countertrend bounce, not a sustainable reversal.

: Used for fine-tuning entries and managing risk with precision. The Four Stages of the Market Cycle

A cornerstone of Shannon's analysis is the classification of market movements into four distinct stages:

While some analysts use three or four timeframes, Shannon typically advocates for keeping it simple with two primary views: the (for trend direction) and the Short Term (for entry timing). Wait for the lower timeframe to confirm the

If you want to dive deeper, read Brian Shannon’s book: Technical Analysis Using Multiple Timeframes. It remains one of the clearest guides on price structure available today.

Shannon argues that the timeframe does not change the psychology of the market participants, only the duration of the trade.

The asset breaks below the support of the Stage 3 distribution phase. It begins making lower highs and lower lows. Moving averages slope downward, acting as overhead resistance during temporary relief rallies. This is the environment for short-selling or holding cash. 3. Selecting Your Timeframe Triads

Watch the 5-minute chart for a breakout above the consolidation resistance, backed by high volume. 4. The Importance of VWAP (Volume Weighted Average Price) Summary of Benefits Stage 2: Markup (Bull Market)

Start with the daily or weekly chart. Ensure the asset is firmly in a Stage 2 Markup phase. The price must be trading above a rising 20-day EMA and 50-day SMA. Never buy a stock that is in a Stage 4 Markdown on its higher timeframe, regardless of how good the intraday chart looks. Step 2: Identify the Intermediate Setup

Traditional technical analysis typically involves analyzing a single timeframe, such as a daily or weekly chart, to identify trends, patterns, and potential trading opportunities. While this approach can be effective in identifying short-term trends and patterns, it often fails to consider the larger market context and potential long-term trends that may be emerging.

The asset breaks out of its Stage 1 base on heavy volume. It establishes a pattern of higher highs and higher lows. The short-, intermediate-, and long-term moving averages all slope upward in a healthy alignment. This is the optimal environment for long positions and swing trading. Stage 3: Distribution (The Top)