Fractured Setup ZT

A fractured setup is one where you have less than 3 converging time frames. For example, the 8 and 13- minute time frames may be in a downtrend with falling stochastics but the 3-minute stochastics is rising and up-trending. These are very difficult to trade. Usually, it’s either a channel tightening forming or a further breakdown forming off the 8/13-minute resistance levels.

A trader might enter a fractured setup to get an ‘early’ entry on a reversal. In the above example, a trader may step in on the 8/13-minute resistance levels against the 3- minute uptrend so that the 3-minute exhausts and when it breaks down, it will form a 3 lane highway down. The early entry going counter to the 3-minute uptrend allows for a greater profit once the 3-minute exhausts and turns.