Stochastic, MACD, Bollinger Bands Plus Day And Swing Traders

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Daily Chart Top-down Trading

The daily chart has serve well technical traders over the years.  I never come across traders who express their dislike to the daily chart.  However, there are few traders including me who are a little bit reluctant to use the weekly chart.  

As the daily chart is very much used by most technical traders, I would like to take this opportunity to teach about the daily chart top-down or different times frame trading.  Well, let's get started.

Validation Of Daily Chart Setups

The rule number one for using the daily chart setups is never use those setups without first validating them on the monthly chart.  

One can quickly improve both day and swing trading if one begins to apply that rule.  Check if the daily chart trading setup makes sense or aligns with the monthly chart price structures or realities.  That is exactly what I meant by validating those setups.  

To help that objective, one will draw all monthly chart's trend lines, channels, pitchfork tools before starting the validation.  With more experience, one can become good at it.  So please do not quit during the trial.

Compilation Of High Probability
Trade Daily Chart Setup

If you have not yet done it, I encourage you to do so because one can not be wandering in the financial markets without a plan.

To avoid a long argument on that matter, and give you a better start, I recommend that one checks out the links below because they illustrate few high probability trade setups.  

Examples of high probability trading structures

Though most of them are monthly setups, one can use them also on the daily chart.  Remember, one will still validate a daily chart high probability trade setup on the monthly chart.
Forgive me to remind you again because it is essential.  

One may not like or understand those setups that I am sharing, but just pick those that you like and understand and stick to them.
As one keeps eyes wide open; and continue to learn more one will also discover other high probability trades.

Time Frames For Daily Chart
Top-down Trading

Though, the minimum requirement for the top-down trading times is two, practically, professional traders use three times frame.

One time frame is for the setup, another for signals and last one is for the entry.  Therefore, the times frame for the daily chart top-down trading strategy are daily, hourly and ten-minute chart.  

The TSTW SYS 008 swing trading system uses the daily chart top-down trading strategy.  Suppose one spots a higher low after a lower high on the daily chart.  Well, that looks really bullish for me on the daily chart.  I will smile and I take note of it.  Now, I must check the monthly chart to validate it.  Yes or no?  You say yes.  That is correct.  

Why do we have to do that?  

Well, we do not want to take off before checking the plane.  Do we?  
We do not want to work with dodgy or bulls' trap setups.  You get it already.  

After the validation, one will switch to the hourly chart.  One just wait for the trading signal.  The signal must be on the edge of a trend line, key level, pitchfork tool or channels.  Never take a trading signal in a void because it is risky, and may require a bigger stop loss.  If the signal is not there, do not move a finger (or do anything).  

People have been damping a lot of cash in the financial markets just because they spot a gorgeous trading setup that they have not validated.  So, they are effectively buying or selling without a valid trading signal.  Please, do not be part of it.

Now, if a good signal is in place on the edge on the hourly chart then smile again; but stay focused because one has a good excuse (warrant) to go to the ten-minute chart and safely enter the trade.  

The entry is just another signal on the entry time frame.

Practical Daily Chart Top-Down Trading

It is easy to quickly understand what the daily chart top-down trading is all about; but the practical bit is essential.  The only way to get there is to use a demo trading account to practice, practice until one becomes a master.  

Do not quit after one month.  If after one has done one's best but no real change occurs then one must seek a helping hand.

Purpose Of Daily Chart Different Times Frame Trading

The main purpose is to improve the market timing and avoid using bigger stop loss and stressful trade.  

It is also gear toward swing trading.  Indeed, most swing traders love to use the daily chart, but most are trading it like a crab instead of a professional trader.  Then people say to me "Oi George, it does not matter."  I does matter because one must always control or reduce the risks.  

One that is using the daily chart without applying the daily chart top-down trading method is taking on a bigger risk.  Well, good luck with that if one has a very deep pocket.  Now that I get your attention; I am pleased with that because a technical trader must always take into consideration the risk-reward ratio and risk management.  Clearly, the daily chart different times frame strategy does help.


The daily chart top-down trading strategy will help both day and swing traders that like the daily chart high probability trading setups.  

I am glad that I am writing this article today because it will make technical traders realise that there is better way to use the daily chart and get the best out of it.  I have done my bit and hope that traders will do their part in mastering the daily chart top-down trading.

That is it.  Thank you for reading it in full.
I hope you will find it useful.  If that is true, please share and bookmark it.  I will really appreciate it.  Please do not hesitate to post relevant questions and comments at 24stocktrader YouTube channel and in due course, I will get back to you.

I wish you the very best.
Happy Trading To All

This article is written by
George Beaulieu
Founder of