Any investor, trader, speculator builds its trading system, trading strategies already created by selecting, modifying them or individual creates the tools that will help him outwit the market (beat the market).
I remember once my boss, a good friend led training on strategies tradingowych day citing a number of different approaches to the market, trend detection, follow him. One such system was to identify the extremes of the graph of the test asset prices. The so-called swing trading in its main assumptions is to identify the peaks and wells at various time intervals. The new extremes, swing high, swing the new minimum is low, the strategy is the formation of support levels and resistance on these levels. If the price goes through the swing and closes above / below the level we have the input signal to the market. It's so roughly. There are also many exemptions and exceptions in this strategy and a matter of fact it is only a sketch of the strategy, because the individual make decisions and interpretations based dokonuemy the shape of candles, using a pointer or other well-known tactics of technical analysis.
swing trading strategy also speaks of a so-called corrections. pull backs (relapses) are corrective waves, which are more or less fixed range, and usually it is 50% of the trend, the longest candle on which this adjustment takes place.
interesting deviation from the theory are known. Bulls / Bears Traps (trap). This move took place today where the market tested the SP500 previous swing high and for a moment above the intraday closed, probably played some of the killing, or even pull back, then the market turned around quickly to the south and the bulls suffered sizeable piercing pain when resistance has been infringed.
so much when it comes to theory, it is known that in practice, we as traders make decisions, and rarely have to do with books in the market realistic examples. I will not go into the discussions on this topic. Lets say the swing trading is a very simplified Elliott, which also allow traders as more and more deviations from the applicable rules.
summarize it this way: as someone already found the holy grail to let everybody know: P
SP 500 H1 :
Market will also take into account data from the U.S. labor market, where at 14:30 payrolls are expected to nearly fourfold increase from 39 thousand to 159 thousand. Indicator ahead of the contract and theoretically ps'y ADP gave a signal improvement in the labor market in the U.S.. As for the strategy of short selling the index is likely to bring the data and determine responses to the U.S. session, but I would consider a false slaughter, bearing in mind the daily closing below the swing high.
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