Swing Trading

get as much swing of the trend as possible

what is the goal of swing trade

trend! long when it's up and short when it's down

We always trade with the

support and resistance ranges

You can also trade in

on pull back (buy the dip) after the trend appears to resume. Your minimum target should be the previous higher high.

In an uptrend aim to buy

on a rally (sell the tip) after the trend appears to have resumed. Your minimum target should be the previous lower low

In a down trend aim to sell

just beyond the recent higher low or lower high

Place your stop

minimum 2 to 1 reward risk ratio

Always have

don't want to be glued to their screen each day

for those who

the week of or week in advance

scan for opportunities when?

2-6 days and sometimes longer

Swing positions last for

daily, 240, then 60 for entries

Which time frames should you use?

checking in on it daily for a few times a day

Manage your position by

Stay with the trend or trade reversals at key areas

two ways to swing trade

your longer term trend

Trade i n harmony with

only on the short term chart when swing trading

Never trade

near the beginning of the trend, not the end

enter the trade

risk to reward ratio and make sure the offs are in your favor at least 2 reward : 1 ratio

determine your

1. Market trend identification

2. Stock selection

3. zone definition

4. Volume and Index Analysis

5. Entry Trigger

6 Exit Trigger

6 Steps in swing trading

use 240 or daily and apply dow theory/elliot wave to determine major trend direction

Market trend identification

8 EMA, 20 SMA, 50 SMA

Which indicators for swing trading

Uptrend

if 8 EMA > 20 SMA

Downtrend

If 8 EMA < 20 SMA

first support or resistance area

50 SMA acts as your

Finviz.com

Where can you go to find stocks?

Look for market leaders and established brands, companies that you believe will be around

criteria for stocks?

on your higher time frames first and color the lines in pairs to tell them apart

First Draw your buy & sell zones

buy and sell zones on the smaller timeframe next, you can also style your lines to tell between weekly and monthly

Second draw your

then there's heavy supply or demand. if price stalls and reverses on high volume, look for an entry signal in the trend direction.

If volume goes up by 50% or more than the average

index, and the other major indices. At least 3 out of 4 should agree on the direction

Check you stock against its

Dow 30 established large cap, s&P 500 companies by market cap, nasdaq 3K companies , NYSE 2k stock small to large

Indices

confirm direction

moving averages

act as trigger

MACD

Early warnings if trade is going to run out of steam

awesome oscilator

it tells us important information for confirming price action

When macd line crosses signal line

equally important, show shift in power

MACD line crossing zero line is

bullish

On higher timeframe when macd line is above signal line trend is

bearish

On higher timeframe when macd line is below signal line trend is

4-6 times higher timeframe

what does higher timeframe mean?

5, 34 and 8

the settings for macd

5 period sma and 34 period sma

AO is the difference between a

trading on the right side of the market and momentum

AO keeps us ...

1) Price moves to test buy/sellzone, trend line, fib level etc.

2) Price & MACD show divergence

3) MACD histogram show strong momentum

4) Price reverses to reject the level

Entry Trigger : Momentum reversal

momentum reversal divergence

this is an example of

1) Trend lines, support and resistance, buy / sell zones etc.

2) MACD shows low momentum

3)Price rejects the zone or breaks the line

Entry Tigger: High Probability Break outs

High probability breakout

this is an example of

1) Using the 20 SMA, wait for price to test that level

2) Watch for MACD line to cross above the signal line

Entry Trigger: MACD as SMA pullback confirmation

MACD as a MA pullback confirmation

This is an example of

We look to be long

When AO crosses above the zero line

we look to be short

When ao cross below the zero line

MACD line above/below zerio line

Watch also for crosses of

the macd line crossing

Look carefully for oscillator divergences that are confirmed by

divergences

These are examples of

1) price rejection at key levels

2) oscilators crossing zero lines in direction of rejection

3) price vs oscillator divergence

4) macd line crossing signal line/zero line

more the better

You need at least 2 of these things to take a swing trade

1) you see counter trend divergence on AMACD

2) Oscillator crosses zero line counter trend

3) double top or bottom patterns form

4) dow theory (failure to make a HH & break of HL, failure to make LL & break of LH)

Take profits when part 1

5) trendline break

6) buy/sell zone target reached

7) elliot wave count completed at Fibonacci retracement/extension

Take profits when part 1

1) Are we in an uptrend or downtrend

2) What wave are we in?

3) Wave 1,3,5

4) Wave 2,4?

5) Wave ABC?

Swing trading checklist part 1

6) Start with larger timeframe, monthly, weekly and determine trend

7) move to daily chart and do the same

8) Use 60 min chart to find entry, enter when this short term trend match daily confirmed by technical analysis and indicators

9) Look at how long the trend has already run, be careful if joining an older trend that might be running out of steam

Swing trading checklist part 2

1) entry price (limit order)

2) profit target (where you will get out with profit)

3) stop loss (where you will get our with loss)

4) add on price (where you will add to the trade)

Ever trade should plan these 4 things, never place trade without knowing these

very short, avoid this

you profit window for counter trend directions are

1) 2:1 reward to risk

2) Losing trade is only a loss if you learn nothing, analyze all trades carefully and do more of what worked

3) This is a game of personal psychology, commit to mastering your own mind

Trade exit plan 3 items

variety of industries

what stocks to choose