6 Ways You Can Trade With Multiple Timeframes

By Brian Shannon, written with Kyna Kosling (@KayKlingson).
First published on August 16, 2025.

Listen to the article:

As we saw in the previous article, different timeframes provide different pieces of the same puzzle.

They allow you to view the same stock at different levels of magnification, with each ‘zoom’ serving a different function. And when you weave together those different timeframes, you build up a more complete picture of the stock’s health and possible price scenarios, improving the accuracy of your analysis.

Once you understand this core principle behind multiple-timeframe analysis, you can find your own ways of incorporating this powerful concept into your trading.

To help give you a few ideas, here are six ways in which you can use multiple-timeframe analysis in your trading:

1. Multiple-timeframe alignment.

The highest-probability trades have alignment across multiple timeframes—because when different timeframes align, so do the different trends:

Note: The same trend may be visible on multiple timeframes. For example, you can display the 5 DMA (daily moving average) on any intraday timeframe (learn how). The 10 and 42 WMAs (weekly moving averages) correspond to the 50 and 200 DMAs respectively.

The lowest-risk, highest-probability trades come from trading in the direction of the long-term trend.

So, even if your primary goal is to capitalize on a shorter-term trend, make sure you’re aligned with the primary (long-term) trend before entering the trade. This is a simple matter of math: The long-term trend is the sum of many shorter-term trends.

Plus, once established, trends are more likely to continue than to reverse. Long-term trends in particular take a lot of energy in the opposite direction to reverse, so offer the greatest opportunity for profit.

But the most reliable moves occur when all trends align—because this indicates that more participants, trading different strategies on different timeframes, will be trading with the same directional bias as you. This significantly increases the odds of your trade idea working.

(Note the use of “more likely” and “highest-probability.” While alignment of multiple timeframes stacks the odds in your favor, particularly if you enter at the onset of renewed momentum on the lower timeframes (see point 3 below), no trade is guaranteed to work. Certainties don’t exist in the market—which makes risk management your #1 job.)

2. Awareness of more potential sources of supply and demand.

Traders and investors are anchored to their entry price—because every market participant ultimately has the same goal: To make money or avoid losing it.

This means that your entry price is your benchmark for success or failure. (Only price pays™!)

That’s why price has a memory. It reflects buyers’ remorse from participants who’ve purchased a stock, only to see the price drop, then wish they could get out at breakeven. This creates a source of supply (i.e. resistance) at that breakeven point. The more people are emotionally attached to that level, the stronger the potential for resistance.

(The same principles apply to support, but in reverse.)

Such levels of support and resistance can appear on every timeframe. And a level that isn’t immediately obvious on your main timeframe can still affect your trade. Consider, for example:

• • If you zoom out to a higher timeframe 🌎️, does a ‘hidden’ level of supply emerge now that you can see more price history?
• • If you zoom into a lower timeframe 🔍️, can you identify more retests of a level, showing that level is more significant than you may have realized from the higher timeframe alone?
• • If you look at a lower timeframe 🔍️, can you identify a ‘hidden’ level of demand close to where you’re planning to enter the stock, giving you a lower-risk opportunity?

The better you understand how different timeframes interplay, the greater your awareness of the likely actions of participants. Is the run-up sustainable? Could you be running into a potential trap?

Always ask 1️⃣ where the stock has come from, 2️⃣ where it has the potential to go, and 3️⃣ whether that potential reward justifies the risk.

3. More precise entries.

Trading is all about leveraging time.

Unlike large hedge funds, you probably don’t need to slowly accumulate 2 million shares during low-volatility periods. You can afford to be precise, getting into a stock just as it looks ready to pick up momentum again in the direction of the longer-term trend.

When you buy stocks at the onset of renewed momentum, and NOT while they’re extended, you minimize your risk and maximize your reward potential.

And since the long-term trend is the sum of several short-term trends, the lower timeframe leads the higher timeframe. In other words, a fresh trend will reveal itself on the lower timeframe 🔍️ before it becomes apparent on the higher timeframe.

If you’re aware of the key level of interest on your main timeframe, and use it as a signal to look at the lower timeframe for a more precise entry signal, you can enter at the lowest risk period and trade with maximum risk unit.

With that in mind:

• • Wait for the pullback on the lower timeframe—let the stock return to stage 1 accumulation on that lower timeframe, provided that the long-term trend remains intact.
• • As the 5 DMA flattens out or just starts turning back up, anticipate the potential trade: What is the theoretical risk–reward?
• • Participate as the stock makes that first higher high and higher low on the lower timeframe.

Don’t buy the dip. Buy strength after the dip.

4. More dynamic stop loss placement and management.

A precise entry as outlined above also allows you to keep your stop tight—below that most recent, relevant higher low—which gives you the greatest profit potential in terms of both the percentage move and share size.

Again, the most reliable moves occur when all trends align.

So, when you enter just as the short-term trend turns in the direction of your trade, and the same direction as the intermediate- and long-term trends, your expectation is for your trade (if long) to immediately start making higher highs and higher lows.

However, winning trades don’t take care of themselves—you must manage them.

❗️ Risk isn’t a static concept.

If you find a good entry, and the trade goes your way, the risk–reward changes. As the stock pulls away from your entry:

• • The distance between the current price and your initial stop loss increases…
• • The distance between the current price and the next significant source of supply decreases…
• • And the greater your risk if you don’t manage your trade.

So, have a plan for protecting your profits.

As long as all trends appear intact, you can manage your stop loss on the lower timeframe 🔍️ that you used for your entry, moving the stop based on the definition of trend: Higher highs and higher lows (or in a downtrend, lower highs and lower lows).

In other words, if the trend (on your timeframe) does persist, the stock should continue to make those higher highs and higher lows—which means that as it makes that next higher high, you can move up your stop to below the most recent, relevant higher low. This keeps your risk tight.

But if the short-term trend shows signs of weakness while the longer-term trend remains intact, you may want to give the stock more room.

The ‘relevant’ timeframe for managing your stop loss then changes from the lower to the higher timeframe 🌎️—specifically, from the shorter-term timeframe you used for your entry to your main, longer-term timeframe. (You could also use a slightly lower timeframe, e.g. the 195-minute, which has two bars per day, rather than the daily.)

Ideally, you’d combine stop loss management with another form of risk management:

5. More precise exits.

Another way to de-risk trades (without trying to guess tops, which is impossible to do consistently) is to take partial profits at key levels or when the short-term trend is broken.

A precise entry puts you in a position of strength from the start, and means you can reasonably look to take partial profits at areas such as:

• • Textbook breakout levels
• • The break of a short-term trend
• • Daily R2 (or where the stock rapidly runs up to this level, use the 2-minute exit)

By having an awareness of significant sources of supply on different timeframes, you can plan where you’ll peel your position—which is particularly important if you’re trading with maximum risk unit.

Rallies on lower timeframes running out of steam don’t signify that the longer-term trend can’t continue. Shorter-term declines are to be expected—they’re part of market structure. Uptrends simply mean that the sum of the rallies is greater than the sum of declines, not that we won’t get any declines.

Always remember: Risk management is job #1.

6. More comprehensive assessment of stock personality.

Each stock has its own personality.

Not everyone is comfortable trading a stock with 20% ATR, for example—which is part of the reason I always encourage subscribers to make the trades their own.

Before committing your money to a trade idea, it’s always worth checking the chart history as part of your analysis:

• • Does the stock have a history of making the types of moves you’re looking for?
• • Or has the pattern you’re looking to trade previously failed?

Again, nothing is certain in the market.

We can only put the odds in our favor by anticipating what price scenarios are likely to unfold based on historical evidence, and part of that involves looking at the personality of the stock to assess the likelihood of a given scenario playing out.

For example, if the stock has historically tended to make a big move up, then get smacked down hard, you need to be aware of the strong possibility this will happen again.

Stock personality isn’t limited to one timeframe.

For example, maybe the stock looks like a choppy mess on the daily chart, but when you zoom out 🌎️ to the weekly, the move looks linear.

Depending on your trading style, this may make the stock tradeable for you, if you manage it on the weekly timeframe. Or if this doesn’t fit your rules of engagement, you may just pass on the trade.

Or maybe the stock appears to have an orderly market structure on the daily timeframe…

…but when you drill down 🔍️ to the 30-minute chart, the repeated large wicks tell you that the activity near opens tends to be wild.

This is a good example of understanding the personality of the stock to help you better manage volatility expectations, and account for such behavior in your trading plan.

Finally, also consider the stock’s history around gaps. Does the stock have a history of frequent gaps? If so, what type of gaps? (My AVWAP book discusses four classifications of gaps, and how you might trade them.)

This information can add another valuable dimension to your analysis.

Multiple-timeframe analysis gives you the context most traders lack.

By not limiting yourself to one timeframe, you’re trading with strategic information that other people miss.

This includes better awareness of:

• • When fresh momentum is coming back into a stock
• • How participants on other timeframes are likely to act
• • ‘Hidden’ levels of interest (potential support or resistance)

You can also manage your risk more precisely and dynamically by using multiple timeframes. Tighter stop losses allow you to keep your risk small while increasing your reward potential, provided you manage your winning trades, using multiple timeframes to your advantage.

These aren’t the only ways in which you can incorporate multiple-timeframe analysis into your trading, but such analysis always enables you to do what you should be doing anyway:

View the same stock at different levels of magnification.

This improves the accuracy of your analysis, so you can anticipate, time, and manage trades better than single-timeframe counterparts.

Multiple-timeframe analysis allows you to see what others miss—but how you incorporate it into your trading is up to you.

As always, make the ideas your own.

Published by Alphatrends.net
https://alphatrends.net/archives/podcast/6-ways-you-can-trade-with-multiple-timeframes