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					Swing Trading
    Paul Brittain
   Alaron Trading
Pbrittain@alaron.com
   1-702-255-4107
      Swing Trading

  Because the currency market often
   experiences short lived intraday
trends, perhaps the most efficient way
    to trade them is through swing
                trading.
      Swing Trading
   Swing traders don’t attempt to
 predict the duration of a trend, or
  to hold a bullish or bearish bias.
 The premise of this trading style is
   that one can capitalize on both
trending and retracement phases of
              a market.
Swing Trading
             The vital
       assumption is that
        all upward price
           action must
        eventually result
          in a period of
            correction.
 Swing Trading

To successfully swing trade in
  the currency market, it is
necessary to have a relatively
 quick trigger for entry and
             exit.
      Swing Trading

Moving average crossovers are often
 the optimal method of timing entry
and exit. This is because, a crossover
is capable of marking the end of one
 trend and the beginning of another.
Swing Trading
      Swing Trading
  If this trading style seems almost
      too good to be true…your
 intuitions are correct. By looking
  at a chart, a trader would almost
     never lose if he/she accepted
moving average crossover signals to
        enter and exit a trade.
    Swing Trading

The problem is that most traders
are not sufficiently capitalized to
hold positions that will eventually
       become profitable.
    Swing Trading

Traders can compensate a Moving
   Average Crossover system by
  placing appropriate stops and
using a trend confirming indicator
  such as MACD or Stochastics.
     Swing Trading

    Trading on Moving Average
Crossovers alone will result in false
  signals. Filtering signals with a
confirmation indicator will alleviate
            some of this.
      Swing Trading

A rule of thumb for stop placement in
swing trading is at the relative high or
low of the previous two price bars. If
 the relative high or low is not beyond
 your entry, use the high or low of the
            next feasible bar.
      Swing Trading


Stops should be trailed. Each price
 bar that goes in your favor the stop
should be placed just above the high
      or low of the previous bar.
    Paul Brittain
   Alaron Trading
Pbrittain@alaron.com
   1-702-255-4107

				
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posted:8/23/2011
language:English
pages:16