Stock Patterns for Day Trading and Swing Trading describes the trading strategies used by a professional stock trader in his own trading. The collection of trading patterns described represents one of the first full-fledged books of instruction on short term, swing and day trading in individual stocks.
This manual is your toolbox for finding high probability trades for success as you trade the stock market. The technical ideas are primarily crafted around the personality of the NASDAQ market but may also be implemented in New York trades. The theory behind what you’ ll be reading hinges upon stock price movement which is reflected in daily and intraday bar charts.
Many approaches to trading are espoused in books and address how to find, enter, and manage your trades. However, you will not find anything in publication or in training which provides you with the experience, dollar potential, and detail behind the trading methodology that is explained.in this manual. These methods are the same ones that have provided some of the earliest electronic (computer) day traders with profits which mounted into hundreds of thousands per year.
Although this trading style is sound and profitable, it also must incorporate the art and mental discipline of each person who applies it. This is why many actual chart examples are provided to give you a feel for what really works. You will learn to time your trade entries and exits from experience with the aid of some helpful tips in later chapters. Be a student of the market and learn how each individual stock moves, its personality, and how the main overall market indexes affect the stock’s movement on a daily and intraday basis.
This method looks for price patterns which typically set up for an intraday trend in a stock. Entering the trade is only the first (and probably the easiest) part of trading. How do you know where to exit ifthe trade goes against you? When do you exit if you have an open profit? You have to manage the trade based on the principle that the stock has chosen a direction for the day, and you are on board for the ride. This means you have to be willing to give the trade the room for price pullbacks against your direction of the trade.
The idea is that on a buy setup a stock will move up, then pull back some, move up to make a higher high on the day, pull back some etc. as it continues its upward movement into the end of the day. Likewise, on a sell setup, the stock will move down to make a new low, then rally some, move down to make a lower low on the day, rally some etc. as it continues its downward movement. You want to stay on board for as much of the ride as possible and not exit the trade too soon and miss out on a substantial profit. These pullbacks are known as “wiggles” and are explained under the “terms and definitions” section of this manual. Each stock usually has its own particular ·”wiggle” which can be determined based on the information provided later in the manual.
Although there are times when a stock will reach a price where you will “cut” (or exit) the trade at a likely profit target, the key to this methodology’s success is letting your winners run by giving them ”wiggle” room.
- INTRADAYTREND METHODOLOGY
- WIN USE PRICE BAR CHARTS
- TERMS AND DEFINITIONS
- HOW THE “WIGGLE” WORKS
- DAY TRADES
- INTRADAY CHART EXAMPLES
- SUPPORT AND RESISTANCE
- MARKET MAKER AND TIME OF SALE SCREENS
- SWING TRADES
- CHART EXAMPLES FOR DAY TRADING AND SWING TRADING
- EXTRA TIPS AND TRADING IDEAS
- PRICE FRACTIONS SHOWING DOLLAR AMOUNT
- TRADE SHEETS
- THE 10 COMMANDMENTS OF TRADING
Stock Patterns for Day Trading and Swing Trading By Barry Rudd PDF