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====== Forex - Multi-Timeframe Analysis ======

Making trading decisions by looking at several timeframes first.

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===== Rule of Three =====

An unwritten rule that recommends that a trader should use three time-frames before they initiate a trade.

Proponents believe that looking at three time-frames will help a trader identify all the necessary points they need to execute a trade.

The rule of three is an essential trading strategy since it can help you avoid making simple mistakes like entering a short trade when an asset has just moved above a key resistance point.

  * It helps traders identify trends in the market. 
  * It helps to confirm or invalidate the primary trend.
  * It can be used to define potential entry and exit positions.

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==== Benefits ====

There are several benefits of using the rule of three in day trading.

  * First, the long chart will help you identify the primary trend.
    * As such, it will help you make better decisions in the market.
  * Second, it is a relatively straightforward strategy that you can use to enter and exit positions.
  * Third, it is a rule that helps you identify support and resistance levels.

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==== The best time combination when you use the rule of three ====

There is no correct answer to this since traders use different trading strategies. 

  * A scalper will often use different combinations compared to swing traders.

^Trader Style^Holding Chart^Trend Chart^Entry Chart^
|Long-Term|1 Day+|Weekly|Daily|
|Swing Trader|Few hours/days|Daily|4-Hour|
|Day Trader|1 Day|4 Hour|30 Min|
|Short-Term|<1 Day|4 Hour|Hourly|
|Scalper|30 Min|15 Min|5 Min|