Stock Swing Trading
Swing Trading and Stock PickingRisk in Swing Trading and Stock Picking : Swing trading of both stocks and futurestrading carry risk. Understanding market analysis during futures and stock picking canmitigate risk and enhance profits. The risk during stock market swing trading iscalculated by taking the difference between the entry point and the protective stop andthen multiplying this figure by the amount of shares. It is similar for futures swingtrading. But in futures trading first multiply the space between the open and protectivestop by the value of each point (e.g., for the 30-year bond each 1/32 of a point is worth$31.50 per contract).Stock Market Charts : The stock market chart history shows our trading results overtime. Stock Market Charts show how just price and volume is used to create excellentreturns for the small investror.Stock-Compass Services : My services include stock market swing trading and futuresswing trading help through our monthly stock market swing trading newsletter as wellas monthly and weekly futures and stock picking. Every week an email is sent out forfutures and stock market swing trading and market analysis. Stock swing trading isenhanced by our weekly stock market sector table and graphs. Futures swig trading ishelped by our weekly Commitment of Traders report and accumulation / distributionfutures graphs. Both stock market swing trading and futures swing trading are helped byour tutorial for calculating targets from trading ranges.
Swing Trading PrimerSurveys show that more than 90% of individual investors and traders of stocks andcommodities lose money. Educate yourself (starting with this stock primer) so you cancross the threshold into consistently making money trading. This trading primer and stockprimer with our historical trading results will help you in this effort. Viewing the tradingresults will help you connect what you learn in this trading primer and trading tutorial toactual trades (get the annotated graphs by simply click on the link of each symbol). Thebeginning and end of each trade is displayed along with an accompanying explanation.No trading system is perfect and ours isn't perfect either. Good trading systems have moregood trades than bad trades and have average gains bigger than average losses. Asuccessful trading system must encompass rules for starting and ending trades, limitingrisk and protecting principal.Reading Stock and Future Charts These candles and bars show how pricemoves over time. This is done by putting these next to each other withnewer prices to the right of the older ones.A stock or futures chart will have either bars or candles at the top part of thechart. This tells you how price moves over time. One can think of the priceas the \"result\" of a certain amount of \"effort\" created by the volume of theshares traded (see the next page).
Picking Stocks8000 U.S. Stocks : There are far too many stocks in the U.S. to pick stocks individually.Filter this large amount so that stock picks can be investigated one at a time. Amanageable group of stock picks can be obtained by a variety of methods.Stock Market Sectors : One of the best ways to cull stocks into a reasonable bundle isthrough sector analysis. Find the sectors that are moving up faster than the market whenit is bullish or the worst sectors when it is bearish. Then pick stocks within those sectorsthat are out performing (i.e., either up or down) the overall market. This will lead you tomuch higher profits.Following the Stock Market Trend : A vast majority of stocks follow the trend of theoverall market. If the market is trending up, picking stocks that are likely to move down isunlikely to be successful. If the market is sinking, stock picking bullish stocks will probablyfail. Read our Trading Tutorial for information about \"Discerning Market Strength andWeakness\".Pick Stocks That Are Likely To Move Quickly : There are a variety of stock pickingpatterns that suggest that a stock is about to move quickly. For example, picking stocksthat have recently experienced huge volume and then later had very low volume in asimilar price range are likely to switch gears and move quickly.
How To Draw and Use Trand Lines and ChannelsA trend is the movement of price either up ordown over a period of days, weeks or even muchlonger. Prices that move sideways are said to bein a trading range (this will be coverered in a laterchapter). In a bullish trend (i.e., when prices goup) the bottom of the channel - the bottom blueline - is called the support line because as long asthe trend continues, prices bounce off of and donot penetrate this line. The top line is calledsupply line because in a valid trend prices bounceoff (do not penetrate this line either) and are soldto push them down.A and B: Pick the most prominent lows for the line underneath the prices. This is calledthe support line. All the prices between these two points must be above the line. Buystocks when the price is near this buttom (support) line.C: Draw a line parrallel to the support on top of this, the highest point between 'A' and'B'. This creates the trend channel. Prices must stay inside this channel for the trend tobe valid.
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Stock Swing Trading