Iām new in swing trading but I read a lot of materials before jumping in !
Got a few sucess first week (+3%), lost all during the second week (non-rational decision, stress haha).
Iām now more careful with my trades, Iām doing 3% so far for the third week.
I notice that thereās some chart pattern that I failed āto predictā
Like a sudden drop, but everything was indicating an uptrend. Or a big triangle consolidation from nowhere.
The 14th everything was fine, big green candle that cross 8EMA - stoch was great.
There was a hammer confirmed a few days before and it did touch the Bollinger wave.
But on the 15 and 16th, there was a pullback from nowhere.
==> is it possible to predict it with some tools ?
Or was it at least possible to be pretty sure that it was going to continue to raise after a few days ?
Same here, during the last four days, you can see price touched a strong resistance line (and the Bollinger before that) - Piercing Line and a good confirmation.
Even more the price did cross the 8EMAā¦
But thereās a drop the two last days.
Could Iāve predict that or itās just a part of probability that I have to deal with ?
Iām using :
Stoichastic RSI
Bollinger Waves
8EMA (sometimes 3EMA and 34EMA to see crossover)
Japanese Candles
I did check MACD or 20-50 SMA but I find the indicators Iām currently using less laggy and more accurate.
Maybe thereās others tools that I donāt know yet that can indeed predict (in the sense of making me more alert) about these sudden drop.
Because for now, itās just unavoidableā¦
In AMD caseā¦ well i would use average true range for the trend strenght wich obviously in that date we can see that trend was loosing strenght even if the price was going upwards. In the image that i posted there we can see the channel, the fibonacci retracements which are so important, where the price retraced perfectly from 0.618. Besides this the price never closed above the 200 MA which i highlighted with yellow.
In NSLN case there is a down trend. You could have been predicted the fall if you marked the resistance line from 1st of february to 7th of february and you can see that few days ago the price stopped right there, in that resistance line
The easiest pattern to trade many people wouldnāt define as a pattern - a trend. The more consistent and with least oscillation the better.
These were always low probability trades. even when youāre 99% confident of what the market will do, 1% of the time it will do what you didnāt think probable. But these trades I would have given less than a 50% chance of working out.
You need a firm and proven set-up. Also, in two trades youāve used two strategies. Just saying.
case 1: standard price fluctuations. cant predit them, must adjust your risk (and your nerves( accordingly. See the candle on the 15th? first gap up, then finishing in red. thats always a warning sign, it is not unusuall that gaps get closed, but after they finish in green= good sign, in red= bad sign. the next day you see a good gap down and a nice red candle. this is no trend change or anything, its just short term price fluctuations. if you want to swing you must clear and set your mind t sit such things out.
case 2: you went long in a clear down trend. classical mistake of seeking tops and bottoms.
skip the 8-day SMA, it is completely useless. Focus on the meningfull numbers:
20 SMA = 1 month of trading - serves as support/resistance sometimes - also called the ādanger zoneā in which āfluctuationsā are very frequent.
100 SMA = straight number a lot of participants watch
200 SMA = very important for the big guys as it corelates to nearly 1 year of action. Serves very often as support/resistance.
so yes, id call it inexperience.
it takes a lot more to swing trade than to other trading. you must start studiny general market conditions more than a specific stock. keep that in mind, if we have a drop in the dow then almost all stocks drop with it or dont advance, if we have a gain in the dow index then generally even the bad stocks advance. you must conduct a top down analysis, where is the indext heading and then you find the strong stocks in that index and long them if the index looks bullish, and short the weak ones if the index acts bearish. before you enter a trade you must do your homework, you didnt do your homework, especially considering that the american indexes are acting rather bearish the last few weeks and show no clear bias towards up or down. once the indexes show a basis for up then you must long your aces stocks (the ones you determined as strong in beforehand while doing your homework( and you will have a very easy game playing for nice profits.
timing is most important in trading, especially tradin on margin. you did not care for timing in your trades, you saw a big juicy bone and ran after it like a dog crossing the street full of cars that could/would/did run over you. Keep in mind, when you see a bone the next time, determine from which side the cars are coming and wait till there are no cars on the street to cross it to catch your juicy bone.
Thanks, so for a rule of thumb, I should go long when the market is bull and go short when trend market go bear ?
Like if QQQ is in a downtrend - itās better to short the weakest one in QQQ (of course after analysing which one match my system) than going long.
?
