How to enter in swing trade

[mukkara99]

Please let me clarify how to initiate swing trade and what is the risk reward ratio

 

[rvlv]

hi

you want to swing trade?
trading swings in price is swing trading.

use a daily chart in amibroker or other software.
choose a stock symbol.
make sure your stock has a good ATR value and reasonable volume
look for swings in price -low to high and high to low
If swings are very short and small, no point of trading.
normally, you can take out 1/3 rd of a swing as profit.
if your swing is 2 rupees,your safe profit is 0.70 --70 paise nothing
dumb traders trade for 5 paise or 70 paise.


use a helpful indicator to find start and end of a swing.
RSI OR MACD OR ADX OR CCI CAN HELP.

dont know technical analysis? dont have a software like amibroker or metastock?
then you are not having weapons to trade
to trade is like to drive a car.
you cant drive a car without a good instructor training you slowly steadily.
you need a mentor in trading.
a good mentor is to be searched for.it takes time.
you have to visit him and talk to him to see how he is the best.
dumb mentors are plenty and readily available.

failed traders come as new mentors and if you go with them, you will be gone too.
there is no free lunch. good mentors are not readily available nor they are free to train as they trade themselves.

he cannot train you in one and half days.
he needs 4 weeks or 13 weeks depending on how good your grasping power and execution is.
ENTER EARLY AS NEW SWING BEGINS. EXIT AS SWING COMES TO AN END.


RISK REWARD RATIO

When you locate an entry,also decide a stoploss level
risk =entry price - stoploss price=R
decide a target from a reasonable distance from entry.
For example let target be 3 times risk
Target =entry +3R
REWARD /RISK =3R/R =3:1

QUESTION IS WHERE DO YOU KEEP YOUR STOPLOSS? BELOW ENTRY IN A LONG TRADE IT DEPENDS ON NATURE OF STOCK YOU TRADE.
WHERE IS YOUR TARGET? ABOVE ENTRY IN A LONG TRADE.
1 atr BELOW ENTRY
STOPLOSS =ENTRY -ATR(10)
REWARD =TARGET =ENTRY +3 ATR
R IS ATR IN THIS EXAMPLE.

 

[oilman5]

swing trade is one of my bread & butter , it takes me about 2yr 2006-07 to learn it .From an accuracy of 33-35% ,now strike rate is 60 % for me.
Swing = mostly a counter trade technique. U r basically observing the price to come down to LOWER SWING PT AND HELD THE PRICE THERE ,then expected to move up towards higher swing pt.Half the value = normal swing target . Extensively Use day chart ,also weekly chart.
Similarly short at higher swing pt ,expecting to come down.
TO improve strike rate , i used in detail HIGH PROBABILITY TRADE.
STD SUPPORT/RESISTANCE - GAP UP/DN PT ,APART FROM VISUAL SWING PT ARE IMP SET UP. price stalling there is validity, now take the trade.
it suits business as unlike momentum/trend , u enter at low OR short at high,so 50:50 strike is ok.
IF market is strongly trending, some uses EXPECTED PULL BACK AS SWING ENTRY.
Normally bad news helps to bring price dn, so at swing low, big fund based buy validates the trade.
MANY GOOD INTRADAY TRADERS USE SWING PT SET UP, but trade differently with 5min/10min candle brake out to trade long using trend, at the start of new trend.

% retracement , MA synergy, RSI divergence r complex swing set up ,with higher strike rate.
+ pt of this set up, u know before trade WHAT TO DO ,SO AT MARKET HR IF PRICE BEHAVES ACCORDINGLY - take the trade ,so less emotional effect.
-pt = u reqd patience ,novice dont understand its importance.
Since u dont chase price , u may miss many strong bull move ,so twig it with pullback .
REMEMBER ITS COUNTER TREND ,SO MAIN TREND HAS TO BE SLOW ,LOSING MOMENTUM- SOME JUDGEMENT NECESSARY WHILE ENTRY

 

[timhuang]

If you are a newbie, I recommend you start by reading a book about technical analysis and chart reading before you jump on a trade.

 

[EXPLORER]

hi
pl explain with an specific example and an chart.

thanks
explorer

 

[TradingPro]

Swing trading is more of long term trading and really demands patience from the trader. To do swing trading well, it is necessary to make sure the currency pair you are trading has a good volume and an impressive average true range value. MACD is also helpful here too in finding the start of a swing.

 

[Pro2016]

Swing trading is a style of trading stocks that attempts to capture short term moves in the stock market. A swing trader typically holds a stock for 2 to 5 days. This is a perfect time frame for those that have a job and cannot "day trade".
A risk/reward ratio is a ratio used by many investors to compare the expected returns of an investment to the amount of risk undertaken to capture these returns. This ratio is calculated mathematically by dividing the amount he or she stands to lose if the price moves in the unexpected direction i.e. the risk by the amount of profit the trader expects to have made when the position is closed i.e. the reward.