Converging time frame set-ups tip the scale big time ZT

A trader must understand that a stock or any trading instrument can be in a wider time frame uptrend but be in shorter time frame downtrend. The divergence within the time frames is what throws many traders off. You always tend to hear people say things like: “Just when I took my stop, it finally moved up, geeez!” In these instances, it’s very likely that the shorter time frames were in a downtrend that found support on the wider time period uptrend. It is at this price level that the shorter time frame exhausts and eventually reverses to move in line with the wider time period uptrend. Taking a position where all time frames are converging in the same direction significantly increases your odds of success.

This game is about finding the transparency before it becomes too transparent. Once transparency has hit, the window of opportunity to gain profits is closed. This often happens when traders end up chasing longs and shorts at their exhaustion levels.

One of the underlying themes of our methods is to REACT, not predict.

By utilizing multiple time frames, I have realized there are key elements of foreshadowing that tend to play out on the 8/13/60-minute charts to foreshadow movements on the shorter 3-minute time frames.