chart is a 5-minute period, and as you can see it generates buy and sell signals. The key thing to remember is that when the 15-minute time period is in a sell mode, take the 5-minute sell signals.
The chart on the bottom right in Figure 9.1 is the British pound; coinci-dently, it had generated the sell signals at the corresponding time period to the euro. Here we have a great example of how to take advantage of trading using a tandem, or like, market to help confirm a signal in a specific market sector. This shows that there was strength in the U.S. dollar at that precise moment, which should give you a higher degree of confidence that a bigger move or a sell-off may be in the works. As such, the market did indeed experience a nice day trade. Now notice that the corresponding 5-minute period in the upper right-hand corner generates buy and sell signals as illustrated by the triangles. If the 15-minute period is in sell mode (triangles point down), then take the sell signals in the 5-minute time period.
As a day trader, you can watch the 60-minute charts; but if you are in a trade based on the 5- and 15-minute periods, these are the time frames you need to continue monitoring for that specific trade. Keeping an eye on the 60-minute charts will help you identify the current trend and a potential change in trend if a moving average crossover occurs. Keep in mind your profit objectives and where you are in the trade as it relates to the average true range. If the euro is already down 50 PIPs when a sell signal is triggered, the odds favor that your potential for profits is only 36 PIPs or less if the average true range (ATR) is 86 PIPs based on the past 14 trading days. The breakdown in Table 9.1 may help guide you on what to watch for and the time periods to follow.
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