One simple swing trading strategy is to:
First, locate the main trend line on the daily chart you want to swing trade a stock.
Second, you set your entry in swing trading to purchase the stock after it pulled back to its main trend line and started to go up.
Third, you set your exit from the swing trade by targeting a certain next recognizable month the stock reached a new high in the past.
Fourth, you write down your entry and exit for each stock you want to hold through multiple swings after you purchase it.
Fifth, you analyze the stock chart to track the course of the stock’s price throughout the year.
Sixth, when the stock pulled back to the trend line you target and started to go up, you place a limit purchase order around midday of the day of the first green bar an indication the pull back ended, and the stock is about to go up. Alternatively, you can place the order early in the morning before the market opens on the next day after the day of the 1st green bar.
The video explains how we use a long uptrend line swing trading strategy to analyze large cap stocks to pick stocks for swing trading.
This strategy allows you to trade a few times a week, freeing you some time. You do not make profit daily in your swing trade. You don’t sell your stocks after a few days but could wait weeks or months to sell for a bigger profit.
Long trend line swing trading strategy
The long trend line swing trading strategy allows you to plan your entry and exit in the swing trade before you even purchase the stock.
Entry: you locate the main trend line the stock keeps coming back to periodically and wait to purchase the stock after it pulls back to the trend line and starts to go up. You might need to pay attention to previous months on the 1-year daily chart time frame, when the stock pulled back to the trend line and record the months in your stock journal just in case it is a pattern.
Exit: You sell the stock after it reaches a high that is well pronounced on the chart before it starts its major pull back to the trend line. Then you wait for it to reach the trend line and start to go up to but again. Pay attention to the months on the 1-year daily chart time frame, the stocks reached major highs during the previous year and record the months in your stocks journal in case it is a pattern.
Time frame: 1-year daily chart; Maximum daily chart. You might use maximum monthly chart to ensure the stock is upward stock and trace the majors trend line and then switch to maximum daily chart to trace secondary trend lines.
First, record your swing trades of the day. Then analyze the stock chart using your swing trading stock watchlist to pick stocks you will trade the next day or next time the stock market is open.
Daily transaction history
After the market closes, download the daily transaction history from your brokerage website.
Save it.
Swing trading recordkeeping
By recording the daily transactions, you will determine the daily profit.
The daily profit is the profit by stock sold. It is the difference between the revenue after the brokerage fee minus the cost of purchasing the stocks.
Record the swing trades in your swing trading spreadsheet using the daily transaction history you downloaded.
Your swing trading recordkeeping consists of you recording your stock purchases, stocks sold, and dividend earned.
Swing trading stock chart analysis
Analyze your stocks’ charts to mark down stocks you might analyze the next day and purchase some shares if they meet your swing trading criteria.
Short trend line Swing Trading Strategy
The short trend line swing trading strategy allows you to swing trade often to practice your swing trading strategy through the year to see how it aligns with your risk tolerance, your personality type and whether it could help you reach your financial goals over time.
With the short trend line swing trading strategy, you could follow the stock and swing trade it even after it strays away from its main trend line. The downside is after you purchase a stock while it is way up, it could pull back multiple days to its main trend line. You might have to hold the stock in your portfolio for a while until it goes back up for you to sell for a profit.
To select stocks to swing trade the next day, analyze the chart of these stocks.
Time frame for swing trading: 1-year daily chart for stocks you swing traded more than once or maximum daily chart for stocks you never traded before.
Swing trading stock watchlist: large capitalization companies’ stocks that went public before 2008 and have upward overall trend to their maximum monthly stock charts.
Stock to pick for swing trading today: Up-trending stocks that pulled back the day before.
Swing trading strategy: Buy up-trending stocks at the 1st green price bar that followed the previous day pull red bar.
Swing trading purchase order: Set a limit price to buy some share of stock at the price it is currently selling.
How much to spend per swing trade: allocate $300 per swing trade or up to 5% of your swing trading account value which is higher.
When to exit swing trading: Sell a swing trading stock when your minimum profit target is reached or exceeded.
Swing trading sale order: Set a limit price to sell your stock at the price it is selling at the time of the sale order request.
What time of the day to swing trade: If you have a full-time job, pick a time of the day to swing trade stocks. You can place your swing trades early in the morning before the market opens. At which case you picked stocks to swing trade after you see the 1st green price bar the day before on their up-trending daily chart.
You can swing trade around your lunchtime around noon when the stock market is open and halfway through the day. This allows plenty of time for the stocks to display whether their price will go up that day for you to buy the ones you picked or not.
Conclusion: How to analyze stocks for swing trading-Uptrend line swing trading strategy
This video explains how we record our swing trading transactions of the day and analyze the stocks charts to pick stocks to swing trade the next business day.
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