Introduction To Swing Trading

If you don’t have access to this, then you can check CNBC, Bloomberg, and Finviz. Moreover, swing traders will also look at SEC filings, too. Due to the market correction, the stock has sold off back around it’s 20-day moving average. I like these types of plays because the market decided the stock was worth more after the earnings report, and the price was only pulled down by mass selling pressure in the market. In comparison to day trading, swing trading definitely has its pros and cons.

It represents a price level or area above the current market price where selling pressure may overcome buying pressure, causing the price to turn back down against an uptrend. In this case a swing trader could enter a sell position on the bounce off the resistance level, placing a stop loss above the resistance line. There are numerous strategies you can use to swing-trade stocks. In this example we’ve shown a swing trade based on trading signals produced using a Fibonacci retracement. The three most important points on the chart used in this example include the trade entry point , exit level and stop loss . Any swing trading system should include these three key elements.

how to find swing trade stocks

The material is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is financial, investment or other advice on which reliance should be placed. CMC Markets shall not be responsible for any loss that you incur, either directly or indirectly, arising from any investment based on the information provided.

Investment Management Errors That Commonly Occurs

PerformanceThis is a comparison of stocks with the performance of similar stocks in the same sector. This is a method to identify the strongest stocks in a sector that has outperformed other sector indices. Access our full range of markets, trading tools and features. The article was superb, especially I appreciate one thing that usually I don’t find in other websites is the graphical representation of data.

There may be a great trade setup out there, but maybe it only is only up 9.95% in the last month, so it doesn’t show up in the Top Stocks screener results. This is why I will use a few different screens, to look for different elements, every couple of days. Assuming you know some trade setups or patterns, the next part of the equation is finding a stock that will maximize the potential gain on that setup. It is already up significantly over the last year or two. When it forms a valid trade setup the price has been running 30% to 40% before pulling back.

This third candle tells us that the sellers have gotten weak and the stock will likely reverse. After you have learned the Traders Action Zone strategy, then fine-tune your skills with some of the tips and tricks in the advanced section. Caterpillar Inc. is the world’s leading manufacturer of construction and mining equipment, diesel and natural Venture capital gas engines, industrial gas turbines, and diesel-electric locomotives. For almost 100 years, this company is driving sustainable progress and contributing towards a better tomorrow by producing innovative products and services. Being a social networking site, daily active users is the key measure to gauge the company’s progress and success.

What Is Moving Averages?

You can find support and resistance through candlesticks and moving average lines. You can use candlesticks for buy and sell signals along with moving avenge lines. I trade setups that have shown a consistent tendency to produce winning trades 50%+ (and usually 60%+) of the time.

  • There are some general rules that every swing trader will swear by.
  • Don, aka “Dewey,” lead equities, Alan did bonds, and Jack was in charge of operations.
  • Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
  • However, what they often won’t tell you is how to mentally react when your swing trading strategy doesn’t work.

But thereafter, factors such as the stock chart pattern and company earnings growth become part of the criteria for picking which stocks to swing trade. Our overall trading strategy is loosely based on CANSLIM. The first key to successful swing trading is picking the right stocks. The best candidates are large-cap stocks, which are among the most actively traded stocks on the major exchanges.

Trend lines map out a stocks direction as well as drawing triangle patterns or pennant patterns such as bull pennants and bear pennants. After signing up, you may also receive occasional special offers from us via email. We will never sell or distribute your data to any third parties. I call this one the Top Stocks, because it captures stocks in uptrends that are closing in on former highs. Are you looking to find the most volatile stocks today? Here’s how you can use Scanz to find the top movers every single day.

Best Swing Trading Stocks To Buy Now

Some swing traders will praise MACD indicators while others utilise an NMA system. Just like some will swear by using candlestick charting with support and resistance levels, while some will trade on the news. A stock that is good for swing trading has a very high trade volume.

how to find swing trade stocks

You will need to adjust the criteria on a weekly basis to find at least 5 to 10 stocks, but not too many. Keep adding filters foreign exchange market until you get to a list of no more than 10 stocks. Going through the list, there are a lot of names that pop out.

Weeden was one of a few trading firms that made an over the counter market in listed shares. Here’s what the screen setup looks like in ThinkOrSwim’s Stock Hacker. Notice that I omitted the XLK relative strength screen because it’s too difficult to setup. The screen fetches a small list of stocks, making it easy to gauge it’s relative strength against XLK manually.

Psychology Of Swing Trading

There are many ways to locate the best performing stocks, including browsing company news, following stock indices, and chasing top stocks on the exchange. To find out more about our strategy for manually finding these stocks, check out this blog post and this one. Recent IPO Alibaba ($BABA) is an excellent example of what can happen when volume does not confirm price action. Typically, these stocks will have a low float and trade with a high ATR relative to their price. An extreme volume day with a wide gap might signal an exhaustion gap. I use the concept of Bollinger Bands to find trading days with extreme volume.

Swing Trading Benefits

To use our technical stock screener efficiently, one needs to have a basic understanding of technical analysis. You can learn about it with What is Technical Analysis and How Technical Analysis Works. Visit our article on ‘what is swing trading’ to learn more about the theories that drives swing trading to be one of the most popular trading strategies. You’ll want to start your trading day early and check on company news.

BLNK – I’ve been waiting for a pullback to swing this one. Using Wednesday’s low of $5.31, I’m watching for an entry and swing back to the middle $6’s or maybe $7 if it heats up. Any and all information discussed is for educational and informational purposes only and should not be considered tax, legal or investment advice. A referral to a stock or commodity is not an indication to buy or sell that stock or commodity. The stock is also in buy territory, evidenced by its 2-period RSI reading of 8.

The range of results in these three studies exemplify the challenge of determining a definitive success rate for day traders. At a minimum, these studies indicate at least 50% of aspiring day traders will not be profitable. This reiterates that consistently making money trading stocks is not easy. Day Trading is a high risk activity and can result in the loss of your entire investment. When you’re looking for stocks to swing trade, you need to know technical analysis.

The index still hasn’t put in a lower low on the weekly yet, so the trend hasn’t broken. However, this is a reason for caution; we shouldn’t be too aggressive with any of our positions. As a rule of thumb, stocks that have consistently advanced will continue to advance, and vice versa.

How To Swing Trade Stocks

Similarly, you can draw a trendline across the highs that the stock price hits. When a stock is trading with higher volume than its average daily volume for a couple of days, there is a high probability that the stock may see a trending move that lasts for weeks. Earning calendars will help you factor in sudden price movements to your swing trading strategies.

Author: Katie Conner

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