Lets say you have two possible trades coming up on two different currency pairs.
On the first one, both, the long term chart and the short term chart are connected, pointing up.
On the second one however, there is a little bit of discrepancy between the different timeframes, long term charts are pointing up, while the short term chart are pointing down.
Which trade would you feel more comfortable taking?
That’s right… the first one.
It’s all about being in the right side
Why is that?
Because when everything is connected, the market is more likely to continue in the intended direction.
In the other hand, when something is not clear, or there is discrepancy between different timeframes, well… its not that likely to continue in the intended direction.