You almost got it, just need to put it the other way round : A retracement of a higher timeframe is a trend on a lower timeframe. So if we are using D1 as the higher and H1 as the lower, we will see :
1- D1 chart, see green candle, retracing down 20 pips
2- Switch to H1 chart, you will usually see the 20 pip retracement coming from the D1 is represented as a H1 red candle here.
3- Look to go short from here.
Note that this is only 1 of the ways to trade. Its actually one of the descriptions of price action across multiple timeframes. Understand this 1st.
Simple isn't it?