Swing Trading

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hershy

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Post Number: 1054
Registered: 10-2002

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Votes: 2


Friday, December 02, 2005 - 06:47 am:

Let me start by defining what swing trading means to me.
The basic criteria is that you trade shares that are moving in your direction. Like hitch hiking if you like. You want to trade shorts ? You need shares in a downtrend. Looking to go long, uptrends of course !
You need several prior higher highs and higher lows or vice versa. You locate the latest pivot point that points in your direction. You seek out any such shares that are now undergoing a reversal from this pivot point and this reversal must signify hurt to those who hold. You need bars that keep making lower lows. You need at least 3 such days and no more that 5 according to the rule book but at times more are OK.
You enter such a trade by by buying when the trade moves one cent above the last high and you hitch a ride to at least the previous high. You can ride further but must be ready to get off as soon as a previous low is beaten.
A very promising trade is SFE.
That this share is in an uptrend cannot be argued. Regular HH and HLs dot the chart. And there are the regular dips which is what I want to trade.
The last dip fell just short of 12% and the blasted off for a magnificent 28% increase in a month. It is now in a dip yet again and the dip is almost identical in % terms to the last one - 12%.
My tactic here is a buy stop one cent above the last high so in this case @ $13.31 and I am hoping for similar performance to the last such event. If the price falls, I follow with my buy stop but no lower than $12.50.

The road to success is usually under construction.

http://members.optusnet.com.au/~hershy/

deanrosario

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Post Number: 1026
Registered: 11-2002

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Friday, December 02, 2005 - 09:31 am:

I, too, (almost exclusively) look for swing signals to enter a trade.

A useful website on constructing Gann swings is at

http://www.afsd.com.au/article/hottrader/soloman6a.htm

Dean

PS: There may be charting software being advertised at this website. I have never used, nor intend to use the software, nor am I endorsing, or not endorsing the software.

"Never commit yourself to anything you can't walk away from in 30 seconds." Neil McCauley (played by Robert de Niro) in 'Heat'.

"I spent a lot of money on booze, birds and fast cars - the rest I just squandered." Georgie Best (1946-2005)

histrionix

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Post Number: 69
Registered: 08-2005

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Votes: 0


Saturday, December 03, 2005 - 09:08 pm:

Thanks for this thread, Hersh. I am still in the steep part of the TA learning curve and to date, have been a trendy. Its certainly cool to be a trendy but obviously much more sexy to be a swinger

!

I like to think that I try very hard to cast an appropriately critical eye over all new (to me) TA information. It is so easy to be wowed by the rearview mirror!

Looking at your chart above and your entry/exit strategy would you not have had to jump ship on 8/11 on that down candle midway up that lovely 28% incline?

Given that you are a bit of a swinger, you probably know all the chics - oops - stocks that have a predilection for swinging! But, have you looked at WBC? She's acting a little coquettish right at the moment, but if you look at her history she has had the good manners to leave a gap between each of her swings - very lady-like!

Happy days.

H

There is a tide in the affairs of men which, taken at the flood, leads on to fortune.

jimdene

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Post Number: 46
Registered: 07-2005

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Saturday, December 03, 2005 - 11:25 pm:

I was somewhat puzzled over Hershy's chart and thought, who am I to question a 1000 post+, until histrionix's post. I can understand not bailing out on the 8/11, but surely, (don't call me shirley), you would have been out before $14.00, or are you going short at that time

julles

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Post Number: 1588
Registered: 01-2003

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Sunday, December 04, 2005 - 01:45 am:

Gee Histroionix and Jimdene ... I challenge you both to put forward in this forum a stock or trade that you have made before it happens ....

Put forth your terms this is a friendly recognition of skills.

No prizes are offered and none will be given. Signed Moi' Julles

hershy

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Post Number: 1056
Registered: 10-2002

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Votes: 0


Sunday, December 04, 2005 - 07:33 am:

Histrionix,Jimdene et mon chere monsieur Julles
The first two gentlemen are spot on et mon ami, je vous merci pour venir à ma défense.
Chances are I would have jumped ship had I been in the trade. I have posted previously in others threads that one of the biggest problems I face with my trading is fear. Too many times to recall I have abandoned good trades when fear overcame greed. The last such example was last week when I fled MND which has since recovered and appears to be on it's merry way. So that's the reality - but was not the plan.
What I proposed above is the plan. The test of one's fortitude is the wherewithal to carry out the plan. Walk the walk and talk the talk. I obviously fail that test.
But let's not let personal weakness take away from what on paper looks like a great tactic. In any swing trade such as this, the aim is to equal a previous high and then get ready to sell at signs of weakness. See the SBM thread. Or is it the Doji thread ? A colleague advocates getting the original stake back at this stage and letting the profits run.

The road to success is usually under construction.

http://members.optusnet.com.au/~hershy/

histrionix

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Post Number: 71
Registered: 08-2005

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Sunday, December 04, 2005 - 07:42 am:

Julles,

There wasn't even the hint of a challenge in the intention behind my post. I seek only to learn. Hershy can, undoubtedly, teach me a great deal about trading - I am very much a newbie. One way to learn is to ask. I have not yet given swing trading much thought. The 8/11 down candle would not have concerned me were I trading a trend. Given the propensity for a swinging stock to do just that - swing - how do you decide whether to bail or hold? What sort of exit rules do you put in place to safely navigate this style of trading?

I do hope that Hershy did not infer anything untoward in my contribution.

H

There is a tide in the affairs of men which, taken at the flood, leads on to fortune.

chart_rider

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Post Number: 119
Registered: 01-2005

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Sunday, December 04, 2005 - 08:46 am:

hershy

The dip on 8/11, based upon closing prices, was 1/2%.

Would this kind of retracement trip you out - a SL that's too tight can have drastic consequences to a trading plan.

In my experience of EOD trend following, I have found stops in the region of 5% to be the optimal. What rules would you apply for the stops while swinging?

CR

hershy

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Post Number: 1058
Registered: 10-2002

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Sunday, December 04, 2005 - 10:18 am:

Chart Rider,
Your is an excellent question.
As I stated above, whatever rules I set myself too often I fail to stick to the plan. So really,I can only speak in theory. Many experts have written on this topic, they all make sense. I like % stop losses but on high priced stocks that can translate to mega dollars while on penny dreadfulls they can be meaningless. Personally I like count back lines but they do often get me out far too early.
What I do most often though is to look for support zones and place a contingency sell one cent below this zone. This tactic does come with it's own woes though. It has led to my being closed out on a spike pivot low as for example 99 cents on KIM on August 31.
Af for learning from me, now that's really scarey.
I just throw ideas around.
Histrionix and Jimdene, Guys, I take no offence, I don't believe any was intended. Feel free to question anything you read in this forum. I often do !
(Hello Alexxx)

The road to success is usually under construction.

http://members.optusnet.com.au/~hershy/

dug

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Post Number: 574
Registered: 07-2005

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Votes: 0


Sunday, December 04, 2005 - 11:07 am:

Hershy,
Can you do a toss about being on 'with other people's money'?
I noted your comment re this in MND and it set me off thinking percentages.In MND you had $10k on say a 10% rise[yeah it was 8 but 10 is simpler]
anyway you pondered Retain Capital,cornerstone philosopy and I just wanted confirmed that a ,like A as in one of other possibilities,a method was to take your 10 grand out and leave a single grand profit 'running'.
Now I find that an "interesting" concept.You may want to explore it in another thread,Hershy? but,well H i just wanted to say I reckon it's a Way to Go but needs what i call 'pondering'.Some parameters of Method.
cheers,
jr

Dig for it.

jimdene

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Post Number: 47
Registered: 07-2005

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Sunday, December 04, 2005 - 01:08 pm:

Julles. It is not a question of being smart after the event, or of forecasting. I was looking at Hershy's chart, posted I would imagine for comment, and gave my opinion, right or wrong.

adetsec

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Sunday, December 04, 2005 - 02:01 am:

I agree with Julles. Placing trade information after the event sets up a false impression that you know what you're doing and is somewhat misleading to newer people on the forum. We are all wise after the fact and a pre-trade statement will overcome these problems.

Comments for discussion only. Not to be construed as advice.

hershy

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Post Number: 1059
Registered: 10-2002

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Sunday, December 04, 2005 - 04:21 pm:

That would have to be the most powerful first post ever made on this forum. Adetsec, I welcome you into our midst.
If this is the beginning, I look to you for some pretty good posts.
Cheers.

The road to success is usually under construction.

http://members.optusnet.com.au/~hershy/

hershy

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Post Number: 1060
Registered: 10-2002

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