By looking at higher timeframes, you filter out the "noise" of temporary, meaningless price fluctuations.
Brian Shannon heavily emphasizes the Anchored VWAP. Anchoring VWAP to a significant event, like an earnings release or a structural low, reveals the average price paid since that event. When multiple time frames hold above their respective VWAPs, buyers control the market. Moving Averages
Look at the daily chart over the last 6 to 12 months. Is the price above a rising 20-day and 50-day moving average? Is it in a Stage 2 Markup? If yes, you have a . You will not attempt to short this stock. Step 2: Identify the Setup (65-Minute Chart)
Before you click "Buy" or "Sell," the top PDF resources suggest running this mental checklist: By looking at higher timeframes, you filter out
A common mistake is trying to monitor too many timeframes at once, leading to "analysis paralysis." If you look at the monthly, weekly, daily, 4-hour, 1-hour, and 5-minute charts simultaneously, you will always find conflicting signals.
: Understanding where a stock is in its lifecycle is critical:
: Multiple sources highlight that the book provides a complete textbook for understanding market structure through the lens of price action, moving averages, and the Anchored VWAP . When multiple time frames hold above their respective
Brian Shannon’s approach is built on the belief that successful trading requires a "top-down" view. Instead of trying to guess market tops or bottoms, Shannon advocates for aligning with the existing trend.
Daily Chart — The primary sandbox. Used to identify Stage 2 breakouts, chart patterns, and moving average locations.
: A clear uptrend characterized by higher highs and higher lows—the most profitable phase for long trades. Is it in a Stage 2 Markup
In trading, viewing a stock or asset through a single chart is like looking at a busy city intersection through a drinking straw. You might see a car moving forward, but you cannot tell if it is about to hit a traffic jam, merge onto a massive highway, or hit a dead end. To solve this visual restriction, veteran market technician Brian Shannon, CMT, published his seminal book, Technical Analysis Using Multiple Timeframes: Understand Market Structure and Profit from Trend Alignment.
: Using 5-minute, 2-minute, or 1-minute charts , this perspective refines exact entries and exits to minimize immediate adverse price movements. 2. Navigate the Four Stages of Market Structure
While Shannon's early work focused heavily on standard moving averages, his modern technical framework relies heavily on the Anchored Volume Weighted Average Price (AVWAP).