Intraday trading the Dow is easier with the Average True Range Stop as support or resistance. Although in the last few posts, I have been writing about how the higher timeframes influence intraday trading (especially when using the average true range stops). Below is a snapshot of what the mini Dow did today. The red lines represent where the ATR stop and the congestion dots are on the 180 minute chart.
Intraday Trading the Dow With the Average True Range Stop
As you can see, price went up and thru the Congestion Dot line. Remember, I tell you that it will come back and test for support? It did and there was no support. Therefore, the next area for it test is the ATR stop line. It found support and proceeded up again.
The Congestion Dot line is at 16158 and the ATR stop line is at 16000 — that’s 158 points!
This is why the higher timeframes are so important. I realize it’s easy to get enticed into your 3 minute charts but that chart is only to lower risk. The bigger picture is always on the higher timeframes.
Again, just another excellent example of how to use the higher timeframes with the average true range stop for intraday trading.