The Perspective of Timeframes

There is a lot of information available today that discusses the importance of knowing your timeframe when trading a stock. This is not so much a discussion on value vs momentum trading, but has more to do with the amount of time for which you want to hold a particular stock. The common timeframe types are: Intraday, Swing/Position, and Long Term.

An example that I will use in this post is CERN (Cerner Corp). Let’s take a look at a few charts over different timeframes starting with the Daily:


As you can see in the chart above, a pretty clear idea of where it has been – and how fast it is going to the next resting/pausing place. Now a look at the Weekly chart:

Here you can see that the action from this most recent week was in fact a Breakout over the Resistance from late September 2011. Note the VaP (volume at price) bars to the left – what we call “air above”. Now on to the Monthly chart:

Now you get an even clearer picture of where price has been and how far it has run since the bottom in 2009. Regardless of your own timeframe, I continue to suggest that you keep your eye on these different chart views so that your Perspective encompasses that of others as well – this way you know what they may be thinking about their trade.

Hope your weekend is going well.

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  1. Pingback: Week In Review: The Best Of The StockTwits Blog Network. | bclund

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