How to Align Timeframes to Potentialize Results

[Igor Pereira]

Professional Strategy for Precision and Consistency

How to Align Timeframes to Potentialize Results

By Igor Pereira
Financial Market Analyst
Founder of ExpertFX School

Multi-period negotiation is one of the most efficient approaches for traders seeking structural consistency and a better risk-return relationship.

It is about combining different graphical deadlines to align direction, context and execution.

Exclusive analysis for ExpertFX School — Igor Pereira:
“The largest timeframe shows the intention of the market. The smallest shows the moment of action.”

In this content, you will understand how to structure this methodology in a technical and professional way.

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The Multiperiod Negotiation Concept

Logic is simple but powerful:

• Timeframe major → Define directional bias

• Timeframe minor → Sets entry point and management

The goal is to improve the profit profile by operating broad structural signals with more refined inputs.

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Operational Structure

Superior Timeframe – Context and Trend

Examples:

• Journal

• H4

• Weekly

Functions:

Set bias: purchased, sold or neutral

In XAU/USD, the Daily chart often determines the predominant institutional flow.

If gold is in structural trend of discharge in the Diary, seeking aggressive sales in the M15 increases probability of error.

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Lower Timeframe – Execution and Precision

Examples:

• H1

• M30

• M15

Functions:

The lower timeframe should not contradict the larger — it should confirm and optimize.

One of the biggest mistakes that traders make when performing a multi-term analysis is that they begin their analysis at the shortest of deadlines and then advance to the highest deadlines. This would be called the bottom-up approach.

Start your analysis in the lower period where you place your negotiations creates a very narrow and one-dimensional view and loses the goal of multiple time periods analysis. Often, traders just take a specific direction or market opinion about the lower deadlines and then are just looking for ways to confirm their opinion about the higher deadlines. We recommend the top-down method. With a top-down approach, a trader starts his analysis in the highest period of time to get a general sense of market sentiment, the general context of the trend and learns of important price obstacles and key levels. In the shortest time, the trader seeks trading opportunities based on the prospect of the highest deadline. The negotiation then fits perfectly into the general narrative of the graph.

WHAT TIMES TO USE? The first question that always arises when entering the negotiation with several deadlines is what deadlines to use. I recommend keeping it simple, especially at the beginning. No need to reinvent the wheel.

The table above shows the most common combinations of deadlines. To improve consistency in your negotiation approach, I recommend choosing a combination and keeping it for a long time. This way, you can gain experience with the specified timeframe combination and see if it is suitable for your negotiation. You want to avoid switching between combinations of deadlines because this creates inconsistencies in your negotiation and introduces noise. Keep a combination of deadlines for at least 30 to 50 negotiations before changing the deadlines.

Now that you've set a combination of deadlines, we can start using our deadlines. But what are we looking for specifically in a longer period of time? Here, traders can choose from a variety of different " suggestions " of higher deadlines (or so-called confluence factors). Depending on your preferred graphical analysis approach, you can find the right option for your own multi-time strategy. Next, I list some confluence factors that are typical for a longer-term approach:

LEVELS No 1 BREAKOUT One of the concepts of upper term most commonly used is that of support and resistance levels. Traders who make use of support and resistance levels in the highest period of time usually seek a recovery or break of a long-term horizontal level. The image below shows the level of the daily period with a strong level of marked resistance. The trader identifies the level in its highest time period and, in the interval, changes to a shorter period of time to look for high trading opportunities.

The image below shows the period of 1H after breaking the resistance level. The price showed a high trend after the breakup and the trader would have done well to adopt a feeling of high and seek the continuation of the trend of high .

Number 2 LEVELS Instead of looking for a longer time interval, traders may also choose to seek recovery at a level of support or resistance. In the image below, the strong level of resistance was maintained several times over 4 hours. As long as the price cannot close above the level, the trader may adopt a low commercial feeling. Especially after seeing the deceleration signal (smaller sails), the drop bias of the higher time period can be used to look for short trading opportunities in the shorter time period.

The less than 15 minutes period shows an interesting graphic pattern of Head and Shoulders at the time of the 4H deceleration sail. With the downward trend of the highest time period in mind, a trader may have a trading plan to sell on the market after successful (or new) neck line breakup.

The price dropped dramatically after the breakup and new head and shoulder pattern test. The strong level of resistance of the highest time period and the deceleration sail allowed the trader to adopt a downward trend from the beginning, while the shorter time period helped the trader to time the overdraft trading effectively. The trading signals over a shorter period of time allow the trader to optimize the maintenance time and also the reward:risk ratio , because the negotiation usually has a closer stop and a more aggressive entry, while using a broader target based on the context of the higher time period.

#3 HIGH AND LOW Instead of using long-term support and resistance levels, some traders use local maximums and minimums for their multi-period trading strategy. The overall approach is therefore similar to the support level and resistance strategy discussed earlier. First, the trader is looking for a high (or low) previous strong. In the image below, the price first exceeded the previous maximum, before a strong low impulse entered the market and the price fell below the maximum. In the technical analysis, we refer to this pattern as false (or trap ) because the initial breakup is failing and trapping breakout traders with purchased positions. This higher time signal is providing us with a downward trend that we will carry to our lowest timeframe.

In the lower period, the price is building a pattern of flight flag right after the false signal. Flags are among the most popular trend continuation patterns. Breaking the trend line usually signals the entry for a continuation of the trend.

The downward trend unfolded after the flag broke. The signal duration of the highest time interval is therefore used optimally. The longer the forecast period, the lower the accuracy. Negotiating the false directly in the highest time usually results in significantly longer periods of detention. When using the lower time to time the input and output, the retention time can often be reduced to an absolute minimum. The shorter the detention time, the fewer additional risk factors - such as news events or exposure at night - the trader will have.

#4 CASTICES Candle trading is a very popular trading approach, but it often lacks robustness when traders rely only on a single candle. To improve signal quality, traders can apply a multi-timeframe approach to candle signals. The image below shows a high candlestick in the highest daily period. At the same time, the price is in general trend of high. In addition, the high sail also occurs soon in the EMA 30 (movable average). Many traders use mobile averages for their pullback negotiations that follow trends. The candle sign fits well in the trend narrative. After identifying the surrounding candlestick, a trader can now move on to a shorter period of time to look for signs of high trading in the bias of higher time period.

The image below shows the shorter period of 5 minutes. The blue area marks the maximum of the daily surrounding candlestick. After the breakup, the price showed a high trend. A trader who follows the trend may have been able to perform a long negotiation to capture the high impulse. While some traders can simply blindly negotiate the daily signal, a multi-period approach allows the trader to find the perfect entry price and benefit from the short-term impulse that the surrounding candlestick signals.

#5 STANDARDS Instead of searching for unique candlesticks in the higher time period, traders can also use complex graphic patterns as a signal for a higher time period bias. In the image below, the highest 4 hour period shows a general downward trend with a lateral flag pattern. The trend line describes the lower boundaries of the flag pattern. After the breakup, the price returns to the trend line to perform a new test. When the price reaches the trend line, the candlestick signals deceleration - the candlestick rotates and shows low impulse. This signal could be used to pass for a shorter period of time with a downward trend in mind.

At the time of the retest signal of the highest time period, the shorter time period of 5 minutes forms a triple upper band pattern. Low-time patterns are ideal when it comes to creating trading plans because they offer a clear and objective entry point. For a short trading plan, the trader awaits a drop break below the minimum default. A breakup then signals a commercial entry. In this case, the trader follows with the highest time trend and also with the lowest breakup impulse. Both deadlines are perfectly aligned.

After the breakup, the price dropped dramatically. The long-term trend continued and with the lowest term sign, a trader could have been able to perform a negotiation with high reward/risk ratio.

POSSIBILITIES
In no way are the negotiating approaches introduced the only ones for negotiation of several periods; they serve only as a source of inspiration to create their own negotiation strategy with multiple deadlines.

There are no limitations when it comes to building a multi-term strategy and traders can make use of all kinds of tools and concepts of negotiation. Whether price action, classic graphic patterns or indicator signals, all combinations are conceivable.

FINAL WORDS AND TIPS
The most important aspect of a multi-term negotiation strategy (and of all other approaches to negotiation in this direction) is consistency. Resist the temptation to skip deadlines and always want to combine new deadlines.

The more noise and inconsistencies you have in your negotiations, the worse the results will be. So choose a deadline combination and keep it for at least 30 negotiations to get an approximate idea of how well it fits into your general business philosophy. After 30 negotiations with the same approach, you will have a much better idea of how it suits you.

And here are my final tips when it comes to negotiation with multiple deadlines:

Start your chart analysis at the highest time. The top-down approach keeps the mind open and usually you will make much better business decisions.

Be clear about your longer term signals. Although I have introduced five different strategies of various deadlines, this does not mean that you should negotiate all five at the same time. Choose a negotiation strategy that suits you and follow it for a long time. System jump is a great danger and must be avoided.

Analyze your chart at the same time every day. By choosing 4H as your highest time period, for example, set an alert for each 4H candle closure and walk through your markets one by one to update your graphics tools and look for higher time period signals.

You don't have to be prejudiced. You will not always be able to reach a clear high or low bias in the graph and it is important to remain open to the idea of having a “neutral” bias. You don't have to negotiate all the time. Wait for the correct chart situation and avoid conducting negotiations below ideal where you have no advantage.