Try These Lesser-Known Time Frames
04/04/2012 2:00 pm EST
By using less-common time frames like on a 13-, 34-, or 55-minute chart, Evan Lazarus gets the same, accurate chart picture, but takes advantage of slightly different entry and exit points.
One of the things traders are always asking other traders is what time frames they are watching to get a good view of the markets. Our guest today is Evan Lazarus of T3Live, and he’s going to talk about the time frames he watches.
So Evan, you have some interesting time frames that are a little bit different from what most people watch. What are they?
Well, my time frames are different only because I’ve never been a believer in the herd mentality.
I think that as traders talk traditional technical analysis, they’re generally taught certain time frames to look at. Daytraders, or short-term traders, look at five- and 15-minute charts; swing traders will look at 30-minute charts, 60-minute charts, and daily charts, and that’s fine and well.
What I’ve done is I basically used the same concept, I’ve just altered the numbers slightly, and the time frames I’ll generally look at, and if I’m in, let’s say, a daytrade, instead of looking at a five and a 15, I’ll look at a five-minute chart and a 13-minute chart.
If I’m in something beyond a daytrade or swing trade, or a position, I’ll look at a 34-minute chart, a 55-minute chart, a daily chart, and a weekly chart.
The reason that I’ve altered the numbers is only because I’m a big believer in the Fib sequence, which is all about harmony in the marketplace, so those numbers are all in accordance with that sequence.
See related: Fibonacci Analysis: Master the Basics
Moreover than that, I find that by altering the time frames ever so slightly, so use a 13-minute chart instead of a 15-minute chart, that same 13-minute chart will show me a strong stock, just as it would on a 15-minute chart, but my points of entry are slightly different than everybody else.
When you’re buying a 15-minute high, or a five-minute high, or a 30-minute high, I’m buying a 13-minute high, or a 34-minute high, so it takes the “noise” that you see out of prices.
Sometimes when everybody’s looking at the same prices and the same time frames, you get this sort of “mushroom cloud,” and there’s a lot of chaos and activity, so I’ve just slightly altered it, and it’s just creating a little bit of edge for myself that I wouldn’t necessarily have otherwise.
Are you one of those traders who use very plain charts—price only, maybe some volume—or do you use indicators as well?
I try and keep it simple. I’m a big believer in simplicity. I think that the more indicators and oscillators and moving averages and all these things that you look at, the easier it is for you to overcomplicate the process that should be simply, up, down, or sideways.
I look at candlestick charts, I look at volume, and I’ll look at two or three key moving averages like an eight-period exponential moving average (EMA), a 21-period EMA, and in uptrends or downtrends, I’ll look to buy pullbacks into those rising averages.
I really keep it simple, because the business of trading is hard enough as it is, and if you make the process overcomplicated, you’re going to lose your ability to think rationally about a trade.