Many people repeatedly fall into traps in the crypto space because they only focus on one timeframe.
Today I'll talk about my commonly used multi-timeframe trading method, in three simple steps: grasp the direction, find entry points, and set the timing.
1. 4-hour candlestick: Determines the major direction for going long or short.
This timeframe is long enough to filter out short-term noise and clearly see the trend:
• Uptrend: Highs and lows are synchronously rising → Buy the dips.
• Downtrend: Highs and lows are synchronously decreasing → Rebound to short.
• Sideways consolidation: Prices fluctuate within a range, it's easy to get whipsawed, frequent trading is not recommended.
Remember this: Following the trend increases your win rate; going against it only gives away money.
2. 1-hour candlestick: Used to mark ranges and find key levels.
Once the major trend is confirmed, the 1-hour chart can help you find support/resistance:
• Near trendlines, moving averages, and previous lows are potential entry points.
• Approaching previous highs, important resistance, or when a top pattern appears, consider taking profits or reducing positions.
3. 15-minute candlestick: Only for the final 'trigger action.'
This timeframe is specifically used to find entry timing, not to look at trends:
• Wait for a small timeframe reversal signal (engulfing, bullish divergence, golden cross) at the key price point before entering.
• Volume needs to be released for a breakout to be reliable; otherwise, it’s easy to get faked out.
How to combine multiple timeframes?
1. First determine the direction: Use the 4-hour chart to decide whether to go long or short.
2. Find the entry zone: Use the 1-hour chart to delineate support or resistance areas.
3. Precise entry: Use the 15-minute chart to find the signal for the final push.
A few additional points:
• If several timeframes show conflicting directions, it's better to stay in cash and observe rather than make uncertain trades.
• Small timeframe fluctuations are fast, always set a stop loss to prevent being repeatedly stopped out.
• A good combination of trend, position, and timing is much better than blindly guessing at the chart.
This multi-timeframe candlestick method has been my stable output configuration for a long time. Whether you can use it well depends on your willingness to look at charts and summarize more.
