Technical Analysis Using Multiple Timeframes Brian — Shannon

Brian Shannon’s approach to technical analysis is built on a foundational market truth: A market that looks heavily overbought on a 5-minute chart might simply be breaking out of a pristine, bullish consolidation pattern on a daily chart. Conversely, a stock that looks cheap on a 15-minute chart could be caught in a vicious daily downtrend, turning a perceived "discount" into a value trap.

You can enter at the start of a new, smaller-term trend that aligns with the larger-term trend, allowing for smaller stops.

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.

: Used to fine-tune entries, manage risk, and spot precise triggers.

: Shannon posits that every market move is part of a larger structure. Primary Trend : Weekly charts guide overall direction. technical analysis using multiple timeframes brian shannon

Technical Analysis Using Multiple Timeframes: The Brian Shannon Approach

: Pinpoints localized intraday execution, allowing for exact entry triggers and risk minimization.

Brian Shannon’s Multiple Timeframe Analysis is ultimately a lesson in patience. By forcing the trader to confirm the trend on a higher timeframe before pulling the trigger on a lower one, it removes the emotional impulse to "guess" the bottom or top.

One of Shannon’s key points is that market structure is fractal. A consolidation pattern on a daily chart (like a cup and handle) looks exactly the same on a 5-minute chart. Brian Shannon’s approach to technical analysis is built

Corporate restructuring announcements or regulatory filings. Market holidays or major gap ups/downs.

Finally, the trader analyzes the short-term hourly chart, which reveals a bullish breakout pattern.

Central to Shannon’s work is the identification of where a stock sits within the four cyclical stages of capital flow:

This discipline forces patience. Most traders lose money because they are "right on the trend but wrong on the timing" (entering too early) or "right on the timing but wrong on the trend" (fighting the daily chart). Shannon’s alignment eliminates both errors. Shannon emphasizes that every stock exists in one

Because you zoomed in to a smaller timeframe, your stop-loss can be tightly placed right below the immediate lower timeframe swing low. This gives you a tiny amount of dollar risk, allowing you to maximize profits if the macro Stage 2 trend resumes. Summary of the Brian Shannon Method High Timeframe (Daily/Weekly) Low Timeframe (5-Min/65-Min) Finding the Trend Direction Finding the Entry Trigger Core Indicator 20, 50, 200 Moving Averages Anchored VWAP / Price Action Risk Function Dictates overall position sizing Dictates exact stop-loss placement Market Phase Identifies Market Stages (1-4) Identifies immediate momentum shifts

Shannon often uses an analogy to explain his approach. Would you ask Vincent van Gogh about his favorite single color to create a masterpiece? A great painting, he points out, requires mixing multiple colors and using different brushes for different purposes. Similarly, a trader needs multiple timeframes—each serving a distinct role—to understand the market’s full message. A single timeframe offers only a limited view. By weaving different timeframes together, a trader gains a deeper understanding of the market's overall health and significantly improves , which in turn increases profitability.

A sustained downtrend with lower highs and lower lows, where short positions are favored. Key Indicators and Risk Management