Framing Time

On the subject of timeframe, there exist many viewpoints covering just how important this is in regards to stock trading. Some traders choose to trade within only one timeframe, like day traders, while others may take on only a Long Term view (especially Value players). One timeframe views – nothing wrong with that. To each his own.

I prefer to take on a Hybrid approach by having separate accounts that are utilized with timeframe in mind (see this post for more on this). That’s just me, my style, my approach and is not for everyone. To help illustrate on why timeframe does indeed matter, let’s take a look at some charts on HII (Huntington Ingalls Industries). The first chart is an Area Daily chart:

As you can see in the chart above, price is working on a B/O over the 31 level and is above the rising 10 day moving average. A nice clean setup, looks good from this viewpoint, and would likely appeal to Breakout players and day traders alike.

But since we are talking about timeframe, let’s pull out to a weekly view for HII:

Hmmmm. This causes me to pause here as this view shows some Topping Tails formed with a Lower High this past week.

Just a quick example of why I stress the importance of ensuring that you study several timeframe viewpoints on a stock that you intend on trading, no matter what timeframe view you have.

Enjoy the rest of your weekend.

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