Chapter 10 USING DIFFERENT TIME FRAMES FOR SHORT- AND LONG-TERM VIEWS. Bar chart analysis is not limited to daily bar and monthly charts provide a valuable long-term perspective on market history that cannot be obtained by using daily charts alone. | Chapter 10 USING DIFFERENT TIME FRAMES FOR SHORT- AND LONG-TERM VIEWS Bar chart analysis is not limited to daily bar and monthly charts provide a valuable long-term perspective on market history that cannot be obtained by using daily charts daily bar chart usually shows up to twelve months of price history for each market. Weekly charts show almost five years of data while the monthly charts go back over 20 years See Figure 10-1 . By studying these charts the chartist gets a better idea of longterm trends where historic support and resistance levels are located and is able to obtain a clearer perspective on the more recent action revealed in the daily charts. These weekly and monthly charts lend themselves quite well to standard chart analysis described in the preceding pages. The view held by some market observers that chart analysis is useful only for short-term analysis and timing is simply not principles of chart analysis can be used in any time dimension. Using Intraday Charts Daily and weekly charts are useful for intermediate- and longterm analysis. For short-term trading however intraday charts Charting Made Easy 35 Figure 10-1. WEEKLY BAR CHART Intel Corporation INTC A demonstration of the importance of long-term perspective achieved by a weekly chart going back almost two years. The triple top provides the first clue that a major reversal may have begun. The reversal is later confirmed by a break in the trend begun in early 2000 followed by a second break of the longer term up trend. Charts powered by MetaStock are extremely valuable. Intraday charts usually show only a few days of trading activity. A 15-minute bar chart for example might show only three or four days of trading. A 1-minute or a 5-minute chart usually shows only one or two days of trading respectively and is generally used for day-trading purposes. Fortunately all of the chart principles described herein can also be applied to intraday charts See Figure .
