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Lower timeframe

A shorter chart interval used to refine entries and see the order of events inside a larger bar.

One daily candle broken into four six-hour candlesA tall daily candle on the left and the four six-hour candles that make it up on the right, with dashed lines linking the day's open to the first candle and the day's close to the last.ONE DAILY CANDLEFOUR 6-HOUR CANDLEScloseopenhighlow=00:0006:0012:0018:00one dayThe same trading, summed up in one bar or spelled out in four.
How timeframes stack up. A daily candle is not different data, only coarser data: it opens where the first six-hour candle opened, closes where the last one closed, and its wicks reach the highest and lowest prices any of the four touched.

Dropping from a 1-hour chart to a 5-minute chart lets you see whether the hour's high came before or after its low, where volume clustered, and whether a rejection was one fast spike or persistent selling.

Traders use lower timeframes to tighten risk: instead of risking the full range of an hourly bar, wait for a small structure to form at your level and place the stop beyond that. Same idea, smaller risk per trade, which raises the r-multiple of the same target.

The danger is that noise grows as the interval shrinks. On a 15-second chart every wiggle looks like a reversal, commissions and bid-ask-spread become a larger share of the move, and overtrading becomes very easy. Use the lower timeframe for execution only, not for changing your mind about direction.

Related: higher-timeframe, multi-timeframe-analysis, timeframe, overtrading

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