Regardless of which technical indicator you use, signals on weekly charts are always more important than signals on daily charts. However, the best option is to combine them to use weekly signals to determine market direction and daily signals to fine-tune entry and exit points.

A trader should follow a daily signal only when it agrees with a weekly signal. When a stock trader uses the signals in this fashion, he or she is using the weekly signals as trend filters for the daily signals. Using the combination of the weekly and daily signals will prevent using the daily signals to trade against prevailing trend. Two crossover systems in which this principle is especially true – MACD and Stochastics.

Andy Swan is co-founder and head trader for DaytradeTeam.com. To get all of Andy's day trading, swing trading, and options trading alerts in real time, subscribe to a one-week, all-inclusive trial membership to DaytradeTeam by clicking here.