Stage 2: Markup (Bull Market) /\ /\ / \ / \ / \_____/ \ / \ Stage 3: Distribution (Top) / \_______/---\ Stage 1: Accumulation (Base) \ _/\_/\___/ \ Stage 4: Markdown (Bear Market) \ /\ \ / \ \____/ \ Stage 1: Accumulation (The Base)
For a deeper dive into these strategies, you can explore Brian Shannon’s daily analysis and educational resources at Alphatrends for a specific recent market event?
When all three align, probability shifts in your favor. When they conflict, the correct action is . For serious traders, mastering this hierarchy is often the difference between random profits and consistent, risk-managed returns. technical analysis using multiple timeframes brian shannon
Shannon emphasizes that every stock exists in one of four distinct stages. Identifying which stage a stock is in prevents you from "fighting the tape." The stock moves sideways after a long decline. Moving averages begin to flatten out. Action: Patiently watch for a breakout. Stage 2: Markup The stock makes higher highs and higher lows.
It helps traders visualize where the "average participant" is in profit or loss, often leading to predictable behavior at those levels. 4. Trade Execution and Risk Management Shannon’s golden rule is simple: "Only Price Pays" . Indicators are secondary to price action. Alignment: Stage 2: Markup (Bull Market) /\ /\ /
To successfully implement Technical Analysis Using Multiple Timeframes , Brian Shannon emphasizes three non-negotiable pillars:
A discussion of Brian Shannon’s methodology is incomplete without highlighting his pioneering work with the Anchored Volume Weighted Average Price (AVWAP). While traditional VWAP resets daily, the Anchored VWAP allows traders to manually select a specific, psychologically significant starting point in time to measure the average price paid based on volume. For serious traders, mastering this hierarchy is often
Brian Shannon’s methodology relies heavily on specific moving averages to define dynamic support and resistance across timeframes. The Essential Moving Averages On a daily chart, three moving averages are paramount:
By waiting for a micro-breakout or a reversal confirmation on a 5-minute chart, a trader can enter a position with a highly defined risk parameters. If the daily trend is up, and the hourly chart is consolidating, the trader watches the 5-minute chart for a surge in volume and a break above local resistance to trigger the buy order. Integrating the Anchored VWAP (AVWAP)
65-minute or 15-minute chart. Used to execute trades at precise intraday inflection points. The Day Trader's Triad