How to apply top down analysis

There are three main categories of time frames:

1. Higher time frames
2. Trading time frames
3. Lower time frames

### Higher Time Frames Analysis

Higher time frames, such as weekly and daily charts, are used to identify the market trend and the overall picture. This analysis is crucial for making predictions and forecasting the market's future direction through trend analysis. Additionally, structure analysis on these time frames helps identify key levels and areas for trading.

When analyzing higher time frames, look for bullish, bearish, or consolidating conditions. Marking out support and resistance levels is essential, as these are the safest points for buying, selling, and swing trading, especially when looking for trend continuation or breaks.



### Trading Time Frames

Trading time frames are where positions are opened, based on the analysis of higher time frames. For instance, using 4-hour and 1-hour charts, you look for confirmation of the strength of structures identified on higher time frames. There are multiple ways to confirm this, such as through reversal price action patterns, rejections, break and retest levels, and moving averages. Once confirmation is spotted, positions can be opened.

### Lower Time Frames

Lower time frames, like 30-minute and 15-minute charts, are generally not used for trading long positions but can provide additional clues. Riskier traders might use these time frames to open trading positions before confirmation appears on the trading time frames.