MONEYMAKING POTENTIAL SWING-HIGH AND SWING-LOW TRADING
TECHNIQUE
This valuable trading technique should help you greatly in your trading, if
applied properly. This "market structure" trend direction method is
basically a pattern recognition method which is amazingly simple but at the
same time it's powerful.
It's the best way we have found to identify market direction and define a
bullishly or bearishly structured market. It is based on the observation that
if you look at a bar chart of any market, you will see a bear market consists
of mostly a series of lower highs and a bull market consists of mostly a series
of higher lows.
These higher-lows and lower-highs are referred to by Commodity Traders Club
as Swing-Lows and Swing-Highs, also known as Pivots, or Pivot-Points.
A swing-low is defined as a low day (or bar) with higher prices both in
front and behind the low day (or bar), thus forming a swing-low. This swing-low
must also be above the previous swing-low, thus forming a higher swing-low.
A swing-high is defined as a high day (or bar) with lower prices both in
front and behind the high day (or bar) forming a swing-high. This swing-high
must also be under the prior swing-high thus forming a lower swing-high.
The concept of buying higher swing-lows or selling lower swing highs are
being used by the most successful large traders. This concept has been used by
them for a very long time. These traders don't talk much about this simple but
potentially profitable technique. Very few traders are familiar with this
powerful, yet simple technique.
Merely buying higher lows and selling lower highs by themselves can
dramatically improve your trading results. You also need to know where to place
a target so you can get out of the market once your profit objective is
reached. You need to know where to place a protective stop-loss if the trade is
wrong. For this we strongly recommend you use "Draw down Minimizer
Logic®" which is explained in detail in CTCN Special Report #2.
Drawdown Minimizer Logic is a mathematical method of sharply reducing drawdown
based on past "adverse excursions."
A sample chart showing how to use swing-highs and swing-lows (a.k.a. market
structure) to trade successfully is in print copy.
The concept of only selling short providing a LOWER "Swing-High"
has occurred, and only buying upon the occurrence of a HIGHER
"Swing-Low" can be very profitable.
This method appears highly profitable when used on old charts, using some
subjectivity on the past data. Old charts and hindsight combine to make it look
highly profitable. However, doing it in real-time trading is more difficult.
Selling providing there are 2 or 3 lower days (or bars), instead of just one
on each side of a high point qualifies as a more significant Swing-High, and
can be very profitable. Of course, the reverse is true for a Swing-Low buy. The
more days (or bars) on each side of the swing day (or bar) is better to more
clearly define the Swing-High and Swing-Low.
The problem is the fact the more days (or bars) on each side there are, it's
likely more of the move is over by the time we can get into the market.
Conversely, the fewer days (or bars) of each side of the pivot bar means the
move has likely not progressed far. However, it's more likely to be a false or
minor Swing-High/Low and consequently less profitable, or a loser.
It's fairly easy to identify and draw buy and sell arrows/dots at Swing-High
and Swing-Low points on charts. However, doing it in real-time trading is not
as easy as it appears on a back-data bar chart.
Nevertheless, the Swing-High and Swing-Low concepts (a.k.a. Market
Structure) are in our opinion the best trend identification tool for trading
the commodity futures markets successfully. It will "work" in any
market, the actual market makes little difference. Of course, as always,
trending markets make it work a lot better.
The concept of buying/selling Swing-Lows/Swing-Highs is simple and can be
amazingly successful but needs to be combined with a good stop-loss method to
give you protection on false signals. It's recommended you use CTCN's copyright
"Drawdown Minimizer Logic®" to scientifically set stop-loss
levels. "D.M.L." is used by CTCN's Swing Catcher® technical
analysis software system but it's not used by CTCN's Real Success method.
However, it may successfully be used with it.
Click-here for our free
"D.M.L." Special Report 2 ... Drawdown Minimizer Logic
P.S. - This profit potential and informative Special Report is regularly
priced at $50.00 (but free to traders via this webtrading world wide Website).
It may seem like too much money for a few pages of information. However, you
should not judge something by its size but by its content and value.
Swing-Highs & Swing-Lows are actually worth a great deal of money. It will
help you greatly in your trading.
Click-here for list of
all FREE Trading Reports
Click-here for more information on the
Real Success2 Trading Course and Software
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