Let’s apply these principles to a real trading day.
Step 1: Start with the Weekly Chart
Step 2: Move to the Daily Chart (Your Decision Timeframe) Let’s apply these principles to a real trading day
Step 3: Drop to the 60-Minute Chart (Your Entry)
Step 4: Manage the Trade
Using this method, you are trading a daily trend with 60-minute timing. Your risk is small, but your reward is defined by the larger timeframe structure.
One of Shannon’s most profitable lessons: When the higher timeframe is sideways (e.g., weekly chart in a tight range) and the lower timeframe is also sideways, do nothing. Most losing trades come from forcing action in a directionless market. Step 2: Move to the Daily Chart (Your Decision Timeframe)
To illustrate the book's value, here is how a typical trade is constructed using Shannon’s methodology: