The Moving Average
This video provides tips on improving five-minute scalping by looking at multiple time frames for better profit targets. The presenter explains how to interpret divergences and chart patterns on five and 15-minute time frames while considering the trend of higher time frames. The video gives guidelines on where to set profit targets, and the presenter encourages viewers to subscribe to learn more.
How to Improve Your Five-Minute Scalping with Multi-Time Frame Analysis
Introduction
If you’re finding it tough to profit from five-minute scalping, this article is going to help you substantially. In this piece, we’ll show you a way to view multiple time frames to get better profit targets for successful trades.
The Moving Average Show
Welcome back to the channel everybody, my name is Artie, and this is the Moving Average, a show where we discuss everything day trading to keep you profitable on a consistent basis. Recently, I asked you all to email me video suggestions, and a fast majority of you guys were asking about this.
Dealing with Contradictory Time Frames
You’re trading on the five-minute time frame, and everything is showing a downtrend, but then when you look at a higher time frame, it’s the opposite. So, what I mean by that is on the one-hour time frame, the price is above the 200 period moving average, and on the five-minute, it’s below. What do you do? Both are contradicting one another; I’m going to do my best to explain when you should enter and where your profit target should be.
Using Moving Averages
Just a quick recap for those of you that don’t already know, I like to use the 21 period moving average, the 50, and the 200. This shows me whether it’s strongly trending above the 21 or if it’s starting to reverse, crossing through these moving averages going towards the 200 and then breaking through that to the downside, showing a new downtrend. You can clearly see right here and right here; the price was making higher highs, and on the RSI, it was making lower highs, showing us a divergence.
Multi-Time Frame Analysis
So, as the price broke through the 200, came back up to retest it, rejected it, and started going down, we show a strong downtrend on the five-minute time frame. So, at this point, you can either enter on this candle after it closed once it rejected the 200, or if you want to be safe and secure, you could have done this huge red candle. But when you switch to a higher time frame like the 15-minute, and when it comes to using two different time frames, you want to stay relatively close to one another.
Trading with the Trend
And like I always tell you guys, counter-trend trading is dangerous. So, if it’s a counter-trend trade on the 15-minute time frame, the higher time frame but it’s with the trend on the five-minute time frame, what should your price target be? Ding, ding, ding, that’s correct, the 200 period moving average on the higher time frame. So, if we take this area as our price target on the 15-minute time frame and take it back to the five-minute, after these two large rejection candles of that 200 period moving average, you can get into a short position with your stop loss at that 200 period moving average on the five-minute time frame.
Conclusion
In conclusion, I really hope that this article has offered more clarification on looking at different time frames when they’re contradicting one another. And I want to thank all of you for sending me all of the video request emails. If you do have a question, please email me right here; that’s also linked down below. If you want to learn more about this five-minute scalping strategy, you can watch this video right here, where I cover it in-depth. Thanks so much for reading.
