When you use multi-level candlesticks (Multi-timeframe Analysis) for trading, the correct sequence and analysis of the strengths and weaknesses of each level are crucial for strategy formulation.
Here are the key points:
✅ Multi-level candlestick sequence: from large to small
High level: Determine trends and major directions (steering wheel)
👉 Example: Daily (1D), weekly (1W)
Objective: Determine if the market is bullish, bearish, or consolidating
Less prone to noise interference, trends are more stable
Intermediate level: Look for structure and important levels (map)
👉 Example: 4 hours (4H), 1 hour (1H)
Objective: Identify key support/resistance, breakout points, range
Used to plan entry and stop-loss/take-profit levels
Low level: Execute entry and exit (magnifying glass)
👉 Example: 15 minutes (15m), 5 minutes (5m), 3 minutes (3m)
Objective: Precise entry and exit
Only used for entry timing and risk control, avoid using lower levels to judge overall trends
📊 Comparison table of the advantages and disadvantages of each level
Level Main Use Advantages Disadvantages
High level (daily/weekly) Trend direction, macro structure High stability, less noise Slow signals, suitable for swing trading
Intermediate level (4H/1H) Key ranges, entry opportunities Balance entry accuracy and trend judgment Sometimes easily influenced by high and low levels, leading to false signals
Low level (15m/3m) Precise execution points Fast reaction, can be paired with risk control High noise, prone to overtrading
🔁 Correct usage principle: Top-down approach
Find direction from higher levels (e.g., daily bullish)
Find structure/levels using intermediate levels (e.g., 1H pullback support)
Use lower levels to capture entry points (e.g., reversal candlestick appears on 3m)
✅ Recommended to pair with
Trading journal records observations at each level
Use the same color to mark different levels of lines/ranges
Avoid making decisions based on only one level, as it may lead to entering the wrong direction