Overview
Using three timeframes in a fixed ratio keeps decisions consistent: the higher one decides direction, the middle one where to trade, the lower one when.
Objectives
- Avoid trading against the bigger picture
- Get precise entries without losing context
Suitable market conditions
- Higher and middle timeframes agree
Tools and indicators
- Market structure
- Support and resistance
- EMA
Market bias
Set only on the highest of the three timeframes.
Entry rules
- Direction from the higher timeframe
- Zone from the middle timeframe
- Trigger from the lower timeframe
Confirmation
- Lower-timeframe BOS in the higher-timeframe direction
Stop loss and take profit
- Stop from the lower timeframe swing
- Targets from the middle timeframe
Risk management
- Fixed risk per trade
Valid example
Daily uptrend, H4 pullback into demand, M15 BOS upward. Entry with a tight M15 stop.
Invalid example
Daily downtrend while H4 looks bullish. The timeframes disagree; no trade.
Common mistakes
- Switching timeframes to find a reason to trade
- Too many timeframes
Advantages
- Consistent decision process
- Better risk-to-reward
Limitations
- Timeframes often disagree, which means waiting
No strategy guarantees profit or a particular win rate. Test any approach on a demo account and size every trade from a fixed risk.