Although I realize the answers to this question may be more opinion oriented than "right" or "wrong" I'm looking for some suggestions. What is a good mix of technical methods to use for choosing entry and exit points of a stock for swing trading? For example: Candlestick patterns with a confirming MACD level/direction. Reasoning with answers would be great if possible. I'm soaking up technical analysis information like a sponge and have come to the conclusion that tracking every possible technical is probably overkill. I want to zero in on a set of techs to use as a guide. I'm seeking a set that compliment/confirm each other. I'm comfortable with most methods I've studied so far and easily become comfortable with new techniques so I have no fear of complexity or high learning curve combinations as long as books or study material is available for them (it). Referral to any free or moderately priced study material answering this question or any free websites would be much appreciated. I have found and read quite a bit online thus far but 99.9% of it simply defines the theory of each method rather than suggest known good combinations applying the indicators. I realize that no "magic bullet" exists but I'm hoping some typical combinations are known to be better than others. After breaking down my last 2 months trade history in detail I've come to the conclusion that my methods need refining and more focus regarding when to enter and exit my trades. Some of this is due to my newness and therefore my "try this method" approach while applying what I learn each day reading but I am ready to become more focused if I can find the right combinations. Any help much appreciated. Thanks. NiteRider
Based on over two years of reading dozens of books and watching one very profitable trader for a week of solid trading I have come to the following conclusion: other than using tick and trin and vix to get an idea of market internals I don't use indicators. Not one. When I stopped looking at MACD, stochastics, CCI, moneystream, TSV, BOP, etc., etc. my trading improved dramatically. Price and volume is where it's at. Focus on that and you can't go wrong.
AMEN!!!!! I also do not follow any indicators other than price and volume to find setups. (must admit using stochastic on my 3 min chart for entry and exit only ) I like to keep it simple sticking to chart formations and price breakouts. Allen
I would like to 3rd that... Other than my moving averages and volume there is nothing else on my charts...
Thanks so much! Those replies were not what I expected and that means my tendancy was going in the wrong direction. I appreciate your help. I realize I will lose money learning but it will be a lot less if I'm not wasting it testing 20 different methods to find the ones that work best. bundlemaker, I glossed over the vix before. I found an explaination of it here: http://www.vrtrader.com/vr_free/trading101/volatility.asp Is the data here adequate? AllenZ, So you look for chart patterns like "cup and handle" etc? Commisso, Attempt to buy at support and sell at resistance based on 50day EMA as support? I need more polish at pinpointing these. This information I can easily find. Thank you. If you have time to followup on these great. If not you've given me more direction which I much appreciate. Saved me hundreds of hours and thousands of dollars by not continuing to test the rest. Thanks again. May your trading be profitable. NiteRider
No indicators, price breakouts and trendline analysis. You will find after looking at thousands of charts you learn to read the patterns.
Price, Volume, Money-flow (tick is much better than chaikin), Indicators... Indicators are almost always completely mental... Allowing for environmentals factors and optimization to be included.
Niterider: While I more or less agree that 20 and 30 seem to be extremes worth considering, I look more toward the trend of the VIX and read "inverse divergences". For instance; if the VIX is making a new low while the market index is making a new high, there is a good chance that you're looking at at least a short term market top. Pull up a NAZ chart and overlay the VIX, you'll see what I mean right away. Hope that helps.