– A sustained uptrend characterized by higher highs and higher lows.
: Use the daily chart to determine if the stock is in a Markup or Decline phase. Refine the Entry
. You’re trying to go long because the 5-minute chart looks 'oversold,' but you haven't realized the 60-minute trend is a falling knife and the Daily chart just broke a primary support level."
Use lower timeframes to pinpoint exactly when to act. – A sustained uptrend characterized by higher highs
Shannon's approach is built on several key pillars that help traders navigate the "noise" of the market:
Most amateur traders make the mistake of looking at a single chart. An intraday trader might look exclusively at a 5-minute chart, while a swing trader might look only at a daily chart. Shannon argues that this creates a dangerous blind spot.
. He argues that "price is the only thing that pays," and that the most consistent way to profit is by aligning multiple groups of market participants across different time horizons. The Core Methodology: Aligning the Trends You’re trying to go long because the 5-minute
: Use smaller timeframes (like the 65-minute or 15-minute) to find low-risk entry points just as momentum begins. Consistency is Key
: The uptrend phase where the most profit is made.
Price moves sideways in a choppy, neutral trading range. Shannon argues that this creates a dangerous blind spot
: A clear uptrend characterized by higher highs and higher lows—the most profitable phase for long trades.
5-Minute, 2-Minute, or 1-Minute Chart — Used for precise trigger mechanics and stop-loss placement. 4. Step-by-Step Execution Framework Using MTFA