Multiple Time Frame Analysis Strategy
Since a security price meanwhile moves through multiple time frames it’s very useful for traders to analyze various time frames while determining the “trading circle” of the security. Through the Multiple Time Frame Analysis (MTFA) you can determine the trend both on smaller and bigger scales and identify the overall market trend. The whole process of MTFA starts with the exact identification of the market direction on higher time frames (long, short or intermediary) and analyzing it through lower time frames starting from a 5-minute chart.
Experienced trader Corey Rosenbloom believes that in multiple time frame analysis, monthly, weekly and daily charts should be used to assess when the trends are moving in the same direction. However, this may cause problems because time frames don’t always align and different kind of trends take place on different time frames. According to him, the analysis of lower time frames gives more information.
