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Trade the Chart

Trade the Trend

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Trade Exits
Because stock trading is not a game

There are several fundamental ways to trade stocks, such as trade the quick pullbacks after sudden large movements in the stock price, trade breakouts, and trade the trend. Trading the trend comes in two flavors, trading longer term trends and trading shorter term trends. The latter is also known as Swing Trading.

In the following pages I will explain in simple terms how to do Swing Trading, and I will highlight what to look for, such as:
  • Trade the short term trend
  • Short term trend can be quickly seen by using the 30 day linear regression line
  • Look for long entries when the short term trend is up, ignore shorting opportunities
  • Look for shorting opportunities when the short term trend is down, ignore long opportunities
  • Look for stocks that had recent deep swings up and down
  • In neutral trends, stochastics give good signals for overbought and oversold
  • In uptrends, stochastics give good signals for overbought, but cannot be used for oversold signals.
  • In downtrends, stochastics give good signals for oversold, but cannot be used for overbought signals.
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