You might see a perfect "Buy" setup on the 5-minute chart, not realizing that the **Monthly trend** is crashing down. You are trying to swim up a waterfall.
**Top-Down Analysis** is the process of analyzing the market from the **Highest Timeframe (The Map)** down to the lowest timeframe (**The Entry**). This prevents impulsive emotional trades.
SVG 1: The Analysis Funnel (MTF Hierarchy)
1. The Law of Dominance and Risk Control
The **Higher Timeframe (HTF) ALWAYS dominates the Lower Timeframe (LTF)**. A "Double Top" pattern on the 1-Minute chart is meaningless if the Daily chart is in a strong Uptrend.
SVG 3: Law of Dominance (Hierarchy of Command)
2. The Professional Routine Checklist
To find high-probability trades, you must perform your analysis in a specific, repeatable order.
Workflow Breakdown:
- **Step 1 (HTF):** Check Weekly/Daily. Establish **Long-Term Bias** (UP or DOWN). Draw major Support & Resistance.
- **Step 2 (Medium):** Check H4/H1. Map the **Immediate Structure** and mark nearest **Daily Order Blocks (POIs)**. **Set Alerts.**
- **Step 3 (LTF):** **Only zoom in** when your H4 alert is triggered. Wait for a **CHOCH** (Change of Character) on M15/M5 to confirm the micro-trend shift and align with the Daily trend. **Execute.**
3. The Perfect Alignment (Sniper Entry)
This is where **risk** is minimized and **reward** is maximized.
SVG 2: The Perfect Alignment (Pullback Reversal)
4. Final Thoughts on Discipline
**Professional trading is boring.** Top-Down Analysis is repetitive, but it prevents the most common mistake: **impulsive emotional trades**.
If the timeframes do not agree, **you do not trade**. Respect the "Big Boys" on the Monthly/Daily charts, and use the lower timeframes only for timing your entry and **refining your risk**. Monitor the structural flow of the market via the Realtime Market Dashboard.
