If you want to apply these concepts to your own trading layout, let me know:
Most technical analysis books focus on indicators (RSI, MACD, Stochastics). Shannon flips the script. He argues that . A moving average on a 5-minute chart means nothing if the daily chart is in freefall.
Disclaimer: Trading involves risk. This review is for educational purposes and does not constitute financial advice. If you want to apply these concepts to
Multi-Timeframe Analysis involves tracking a single asset across at least two to three different chart frequencies. The strategy dictates that you never look at a chart in isolation.
Before we dissect the PDF, we must understand the author. Brian Shannon is not just an academic; he is a practicing trader with decades of experience. He is the founder of Alphatrends and the author of the bestselling book "Technical Analysis Using Multiple Time Frames." A moving average on a 5-minute chart means
This is where the big money is made. The asset breaks out above the Stage 1 resistance, characterized by expanding volume. The price moves into a structural uptrend, forming higher highs and higher lows. The 20-day and 50-day moving averages slope upward, acting as dynamic support. Shannon’s strategy emphasizes buying pullbacks and breakouts during Stage 2. Stage 3: Distribution (The Topping Phase)
Price Action: ____/¯¯\___/¯¯\___ <-- Volatility AVWAP Line: /_________________ <-- Starts exactly at the Anchor Point ^ [Anchor Point] (e.g., Earnings Release or Major Low) What is Anchored VWAP? and moving average locations.
Brian Shannon’s approach is often cited by traders looking for "top" analysis because it prevents the common trap of catching a falling knife.
| Do | Don't | | :--- | :--- | | ✅ Align all three time frames before entering | ❌ Buy on LTF strength if HTF is down | | ✅ Use LTF only for entry timing, not for trend | ❌ Use LTF stop loss that violates daily structure | | ✅ Re-evaluate if HTF trend changes | ❌ Ignore a weekly reversal signal for a daily setup | | ✅ Scale in on pullbacks within the trend | ❌ Add to losers |
Daily Chart — The primary sandbox. Used to identify Stage 2 breakouts, chart patterns, and moving average locations.