Replies to post #243 on Swing Trading Model

[LiveLife]

Use of Technical Indicators - Over the decades, I have used faster and faster technical indicators to enter the position at the bottom of the rebound.

So 50/200 MA became 5/30 MA and now I am finding even 5/30 MA is too slow for my swing trades (The template is 15 years old). I am actually thinking about updating the template with 2/5 MA which is faster. (Rerun the chart with 2/5 MA and it should give you a better indicator for entry point)

Now, I find MACD blue histogram bars going negative to positive (or + down to 0 and back up +) and MACD line (black) crossing above reference line (red) or MACD line falling to reference line and rising above better indicate BUY point.

And RSI falling below 30 (red), especially double/triple bottom helps to avoid false rebound. And RSI rising above 70 (green) indicates you should be looking for profit taking points, especially intraday spikes as selling at the HOD/intraday high allows you to buy back when the price falls back down as price movement trades within the ascending channel or break out.

For the most part, my current swing trading is focusing on high/super high volume stocks undergoing rebound to essentially make swing trades on Technical Rally/Short Squeeze and capturing as much of the gains by entering close to the bottom of rebound and exiting at the peak of bounce. And capturing any rebound/cup and handle movement after retracement/pullback (And why the "Breakdown Table" for the watch list has 2 cycles of Watch/Buy/Hold/Sell).

And what happens afterwards?

For this swing trader, since I always have other rebounding stocks lined up to trade, I will move to next stocks to trade after I exit the position. Yes, there are exceptions as some stocks continue to gain after "cup and handle" but refocusing on other rebounding stocks will produce higher percentage gains.

Pland the trade and trade the plan.