THE ART OF MULTI-TIMEFRAME ANALYSIS AND MULTIPLE CONFLUENCES
Hey, wizards, hope you are all having a great week so far! We would like to welcome all of you on another educational post, the topic of which is Multi-Timeframe analysis and multiple confluneces involved.
As it can be inferred, the Monthly and Weekly timeframes are used to determine the direction of the market, the Daily timeframe is used to identify key areas and important zones, and finally, the 4-hourly timeframe is utilized for entering trades. Now, let’s dig deeper into it and analyze the situation that we have on EUR/USD.
MONTHLY: Observing the weekly timeframe graph, we can say that the price has been printing bearish candles for a few consecutive weeks. As one of the main trading principles says, after a strong impulsive move, a correction is needed. We can witness some bearish weakening signs and therefore we are looking for a short-term long position. Our possible target would be set at a previous level of support turned resistance, which aligns with the golden Fibonacci zone.
WEEKLY: Leveling down to the weekly timeframe chart, we can see that the price is consolidating, as it is unable to push lower. Technically, after long lasting consolidations, it is believed that the price will either fly like a rocket or drop like a needle. This gives us another confluence and backs up our plan.
DAILY: Moving down to the daily timeframe graphic, we can notice that the previous candle was super bullish and some kind of an ascending triangle is being formed. If the price breaks and retests the upper boundary of the formed triangle, we can see some nice bullish moves.
4H: Last but not least, the 4-hourly timeframe a.k.a. the timeframe of entries. After a massive bullish push to the upside yesterday, the price has started correcting before further bullish moves happen. Here, we are using two entry confluences: the area of previously broken structure that nicely aligns with the 61.8% fibonacci retracement level. Before entering the trade, we will carefully monitor the price action and wait for the price to bounce off the local zone.
We are hoping that this educational post will be of value for you and we are wishing you all a great day!
Regards,
Investroy Team
As it can be inferred, the Monthly and Weekly timeframes are used to determine the direction of the market, the Daily timeframe is used to identify key areas and important zones, and finally, the 4-hourly timeframe is utilized for entering trades. Now, let’s dig deeper into it and analyze the situation that we have on EUR/USD.
MONTHLY: Observing the weekly timeframe graph, we can say that the price has been printing bearish candles for a few consecutive weeks. As one of the main trading principles says, after a strong impulsive move, a correction is needed. We can witness some bearish weakening signs and therefore we are looking for a short-term long position. Our possible target would be set at a previous level of support turned resistance, which aligns with the golden Fibonacci zone.
WEEKLY: Leveling down to the weekly timeframe chart, we can see that the price is consolidating, as it is unable to push lower. Technically, after long lasting consolidations, it is believed that the price will either fly like a rocket or drop like a needle. This gives us another confluence and backs up our plan.
DAILY: Moving down to the daily timeframe graphic, we can notice that the previous candle was super bullish and some kind of an ascending triangle is being formed. If the price breaks and retests the upper boundary of the formed triangle, we can see some nice bullish moves.
4H: Last but not least, the 4-hourly timeframe a.k.a. the timeframe of entries. After a massive bullish push to the upside yesterday, the price has started correcting before further bullish moves happen. Here, we are using two entry confluences: the area of previously broken structure that nicely aligns with the 61.8% fibonacci retracement level. Before entering the trade, we will carefully monitor the price action and wait for the price to bounce off the local zone.
We are hoping that this educational post will be of value for you and we are wishing you all a great day!
Regards,
Investroy Team