Webinar Recap: Trading the 5-Minute Time Frame with Precision
November 23, 2017In addition to providing some of the best trading tools for active traders, we strive to continually engage our users with useful, educational content that helps them become more efficient and effective in their professional lives. As part of this effort, we invited Greg Capra of MasterTrader.com to host a webinar based on his innovative trading concepts.
Over the past 30 years, Mr. Capra has served as a luminary for swing and day traders. For the last 23 years, he has shared his trading strategies and revelations with traders as an educator in the industry. He continues to offer trading insights and lessons through MasterTrader.com.
His session, titled “Trading the 5-Minute Time Frame with Precision,” aims to encourage simplicity and clarity in trading strategies. Through his presentation, Mr. Capra sought to provide a few foundational concepts that form Master Trader Technical Strategies (MTS) in a direct and pragmatic manner. The webinar can be viewed in full here.
Keys to Success
Mr. Capra commenced the webinar by discussing what he considers to be the essential components of successful technical investing and trading.
- Price Is King – When analyzing trends and determining next steps, never lose sight of the actual price movement. Ultimately, price should drive every decision.
- Candlestick Analysis – This graphing method likely presents information in the most transparent, easily graspable manner.
- Trend and Multiple Time Frame (MTF) Analysis – Analyzing trends over multiple time frames offers the best chance at success by providing a more holistic analysis of price movement. Then, working down to the five-minute time frame serves as a highly efficient market analysis method.
- Support and Resistance Analysis – Is a key component of Mr. Capra’s technical strategies and it was pointed out not to be confused with his use of moving averages, used for actual price support or resistance.
- Moving Averages – Mr. Capra explained his unique method of calculating moving averages to determine which moving averages will display the trend of a higher time frames on the lower 5-minute time frame. These moving averages provide traders a focus on a signal time frame with the knowledge of trends in multiple time frames.
- Volume Analysis – Mr. Capra feels that volume analysis might be somewhat overemphasized. However, it serves as an excellent indicator of probable turning points.
- Position and Money Management – Lastly, even the best chart reader may fail without sufficient position and money management skills.
Finding Patterns
Beyond these foundations, Mr. Capra discussed the importance of pattern recognition. Although traders should be careful not to fixate on finding exact matches for textbook patterns, facility with these models greatly aids trend analysis.
- Retracement – This pattern indicates that a stock’s price is experiencing a temporary reversal, counter to the overall trend.
- Retest and Failure – Retest and failure patterns show that a price fluctuated for a moment before moving along the direction of the general trend.
- Flag – Flag patterns indicate a sharp price movement closely accompanied by sideways movement.
- Well-Developed Base – This pattern illustrates a relatively stable trend that gives traders a profitable support area.
Mr. Capra especially focused on the concept of the void, which he formulated himself over the course of his career. When prices move rapidly, seemingly without any support or resistance, the potential exists for dramatic price movement back in the opposite direction after an indeterminate amount of time. The latter movement seemingly pays little heed to previous areas of support or resistance. Through the analysis of moving averages over multiple time frames, traders may be able to assess the volatility of such stocks in such a way as to predict this movement with a high degree of success.
At the end of the webinar, Mr. Capra took questions from participants and described the informative courses available on his site. MasterTrader.com provides both free and paid content that aims to provide traders with valuable lessons and resources to help strengthen their knowledge and expand their repertoire of trading strategies.
Whether you’re a veteran trader or just getting started, Lightspeed offers some of the lowest trading fees in the industry to help you maximize your profits in your chosen strategy. To learn more about our trading tools or to try a demo, call us at 1.888.577.3123.
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