How many traders here look at quarterly charts?

Hi Everyone

I was wondering how many traders here use quarterly charts to time their market entries? Some very interesting insights can be gleaned by doing so. I know software like boursedata doesnt show quarterly pricebars but bigcharts does. I notice that economists always speak in quarters, but I have yet to speak to a trader who does or realises the significance of these.

Cheers
Happytrader

I place high importance on 3 monthly charts. They give me a good feel for what a stock is doing.

Here some interesting and possibly beneficial facts from 'The complete idiots guide to Economics' by Tom Gorman.

There were 10 recessions between 1929 and 2002 ranging from six months to 16 months and averaged 11 months. Between 1939 through 2002, after the USA absorbed the lessons of the Great Depression, the nation experienced economic growth 86% of the time. Some recoveries were stronger than others, but some of the recessions were mild as well.

What does this pattern of business cycles mean to your wallet or piggy bank? It means that if you understand that a recession is cyclical and believe the economic fundamentals are sound enough to support a renewed growth cycle, you can make moves to benefit you.

For example, if you buy a house, stock, or mutual fund two quarters into an economic, expansion, you will still do pretty well. You will certainly do better than you would by waiting two years to make sure that the expansion is under way. Similarly, if you understand that a recession will probably last no more that three to five quarters, you can make plans to ride it out in a clearer frame of mind than if you believe the next Great Depression has arrived.

I have noticed that some banking stocks like WBC will move up to a new price range in one quarter and spend the next two quarters trading within that range more or less before it does it all over again. Why not check some of your blue chip stocks to see when a good time to buy and hold might be?

Cheers
Happytrader

happytrader said:

I have noticed that some banking stocks like WBC will move up to a new price range in one quarter and spend the next two quarters trading within that range more or less before it does it all over again. Why not check some of your blue chip stocks to see when a good time to buy and hold might be?

Cheers
Happytrader

Click to expand...

Great thread Happy, I like your perspectives, I look at longterm charts and then drill down to dailies but don't always pause at quarters (only occasionally when I notice a pattern). Something to work on for me now, thanks!

RichKid said:

Great thread Happy, I like your perspectives, I look at longterm charts and then drill down to dailies but don't always pause at quarters (only occasionally when I notice a pattern). Something to work on for me now, thanks!

Click to expand...

Yes, great thread happytrader.
When you study W D Gann you realise you have to
consider the bigger time frames.

Hi everyone

Just a wee reminder, we will soon be entering a new month and most importantly a new quarter. Might be time to take a peak at those quarterly charts. (particularly those bluechips and particularly those ranges).

The market looks very 'euphoric' at the moment but remember all markets go up, down and sideways and it can do it all within a month and more so within a quarter. Lets all make it a date to be timely positioned for any direction it will take.

Heres to a prosperous year for myself and every single one of my fellow traders and believers at ASF.

Cheers
Happytrader

I never as such look at 1/4ly price bars but i certainly note quarterly high low and 50% levels as to get an edge on bias . i do this on several time frames to gauge bias and potential pivots trading various times from daytrade to swing (position) . laws of multiple time frames is the singularly best information i found to progress my trading to the next level after evaluating almost every indicator know to man . now indicators are the last thing i look at pretty well

trendlines /resist and supp
linear regression
fibonacci


all on multiple time frames are my main and very basic tools that i use

certainly one thing not to be overlooked is fundementals which ultimately will decide on chart bias over the longerterm time frames , many chartists would improve there equity curve if they embraced fundementals . easy pickings this year on blue chips such as CBA BHP WPL etc etc trading the bias which was defined ultimately by FA . trade the FA bias using TA to acheive value entries . trade with the trend not against is sound advice yet so many fail to do so . i know many great chartist that are guilty of that shorting uptrending markets at TA produced levels . anyway here are the laws


LAWS OF MULTIPLE TIME FRAMES

1. Every time frame has its own structure.

2. The higher time frames overrule the lower time frames.

3. Prices in the lower time frame structure tend to respect the energy points of the higher time frame structure.

4. The energy points of support/resistance created by the higher time frame's vibration (prices) can be validated by the action of lower time periods.

5. The trend created by the next time period enables us to define the tradable trend.

6. What appears to be chaos in one time period can be order in another time period

Hi Brisvegas

Thoroughly agree with your comments and the laws of multiple timeframes.

Cheers
Happytrader

IMO multiple timeframes certainly do help with discretionary trading.

"Which" time frames will depend on the intended time frame of the trade.

I personally don't look at quarterly bars.. or even monthly bars, just not relevant for my time frame, but I can see where they would be handy for traders trading with that length of view.

Apart from that agree with all thats been said.

brisvegas said:

I never as such look at 1/4ly price bars but i certainly note quarterly high low and 50% levels as to get an edge on bias . i do this on several time frames to gauge bias and potential pivots trading various times from daytrade to swing (position) . laws of multiple time frames is the singularly best information i found to progress my trading to the next level after evaluating almost every indicator know to man . now indicators are the last thing i look at pretty well

trendlines /resist and supp
linear regression
fibonacci


all on multiple time frames are my main and very basic tools that i use

certainly one thing not to be overlooked is fundementals which ultimately will decide on chart bias over the longerterm time frames , many chartists would improve there equity curve if they embraced fundementals . easy pickings this year on blue chips such as CBA BHP WPL etc etc trading the bias which was defined ultimately by FA . trade the FA bias using TA to acheive value entries . trade with the trend not against is sound advice yet so many fail to do so . i know many great chartist that are guilty of that shorting uptrending markets at TA produced levels . anyway here are the laws


LAWS OF MULTIPLE TIME FRAMES

1. Every time frame has its own structure.

2. The higher time frames overrule the lower time frames.

3. Prices in the lower time frame structure tend to respect the energy points of the higher time frame structure.

4. The energy points of support/resistance created by the higher time frame's vibration (prices) can be validated by the action of lower time periods.

5. The trend created by the next time period enables us to define the tradable trend.

6. What appears to be chaos in one time period can be order in another time period

Click to expand...

http://www.fibonaccitrader.com/FAQ/What_is_multiple_time_frame/default.htm


1) Price movements have their own structure independent of time frame
2) Large price movements both contain smaller price movements and are
built form them..
3) price movements respect energy applied as a force in the moment
4) Large moves have to be validated by the small moves ( tests responses )
5) The trends with the most energy behind them are tradable.
6) To create order requires energy.
order is the opposite of random
energy is information
applied information is force
This takes time ( to act )
without a preparation and coming to fruition
opportunity is chaos, with enough time
chaos resolves into a forced move of high probability
random resolves into order that unfolds ( trends )

Time is real time frames are unreal.

A Point and Figure critique of '' The Laws of Multiple Time Frames "

by
motorway

Not me,

I run down from monthly to intraday

Agree with MW and Bris.

However trading in shorter timeframes quarterly has no meaning for me.
Trading longterm systems or any system really Quaterly is of no value as no systems I have uses quaterly data.

Personally I question the validity of the "Trueism" of drilling down from such a high timeframe.
Maybe fine for trading Monthly (Quaterly,Monthly,Weekly)
But I question smaller timeframes.
I use 3 levels when discretionary trading.
No further out.

If EOD (Weekly,Daily,2 Hrly) for example.

Elliott Wave Theory integrates some of these concepts into its principles via fractal theory and fibo. EW shows best in the most freely traded/highly liquid markets (eg FX, Commodities, DJIA etc). Nice thread.

This is an interesting thread, I believe that multiple timeframes are all about how the market works !!

Using multiple timeframes show us the underlying structure of the market.

We all know that on the timeframe we trade from, the price can be in one of four states ie accumulation, trending up, distribution or downtrend, this is true of all other timeframes.

The lower timeframe price action is the building blocks of the higher timeframe price action all the way up to yearly and beyond.

However, the price action on each timeframe is to a certain extent independent of the other time frames above and below, i.e the monthly may show an uptrend, the daily a downtrend and the hourly an uptrend, or any other combination..
The ultimate result is that the lower timeframes actions are combined to acheive the state of the higher timeframes.

The market is fractal in nature, i.e it has recurring patterns and these patterns are shown across all timeframes.
We can draw trendlines, support and resistance lines, line studies etc on all timeframes i.e the market has a memory.

So how does a market work?
(My interpretation) Each timeframe has its followers who watch the same charts for buy/sell signals on their chosen timeframe and place corresponding orders into the market.

The trader working from the lower timeframes will get his signal first and place his order into the marketplace - other traders using the same timeframe will also see this signal and place their orders - and so a move is initiated.
More and more traders on this timeframe see this trend taking off and join in.
There comes a time when all traders in this timeframe are fully committed - so the trend will falter
UNLESS
The price action on this timeframe has combined to provide a signal on the next higher timeframe

The traders who use this higher timeframe to trade from, see this signal and place their order into the market and thus the trend continues - if traders on this higher timeframe decide not to participate, the trend cannot advance !

The trend must have new participants (energy) to keep going.

I use three timeframes ie one above and one below that which I trade from. I believe using any further out timeframes are irrelevant to the time period I trade.

Timeframes tend to have their own followers. the bigger money tend to trade the higher timeframes i.e. weekly/monthly charts are probably the domain of fund managers etc, they are in for the long haul, and have the financial backing to ride out any "market noise"

Time frame realities: (say daily /weekly)
The lower the timeframe for a particular setup:
1 The $ value between entry and exit and initial stop will be less - therefore we can have a larger position
2 When we exit, our exit will be higher than that on the weekly.
3 We will be more active, as we will get more trade signals.
4 Our trades will be shorter duration than those on the weekly (less profit)
etc, etc

Best trades:
When all three timeframes are in the same state and confirm each other.

Do I think the use of multiple timeframes is important - ABSOLUTELY !!!

The above is my instinctive responce to this subject. Maybe I should have thought it out a bit better - but in anycase it may give you something to think about? and that can only be beneficial

Peter