The chart above is a swing trader's map to making money. Swing traders use charts like this one to manage their entry and exit points and maximize their chances for the highest profits. The trick is to buy in one of three places: At the bottom of the channel, within narrow bars at the top of the channel, or right above the channel if the stock breaks through.
A swing trader might plan an exit near the 200-day MA, and if it works, he may come away with good profits that wouldn't necessarily be found by other trading strategies. In this example, an alert swing trader could have bought at channel bottom, just around 52, and sold when the stock reached the 200-day MA, just above 62, for a 20% profit in just 20 days. Charts like these are familiar to veteran swing traders.
What may not be so familiar to you is Alan Farley's brilliance in finding where he believes the profits are hidden in those charts before they play out. But then, he's been doing it awhile..
. For over 20 years Alan was a businessman just like so many others, trading on the side. And like so many others, he searched for ways to make his trading more profitable.
It didn't take him long to discover technical analysis. This, he figured, would give his investments more direction. Alan began absorbing everything available on technical analysis.
For three years he did this. He used what he learned, and mastered the techniques. Then he began tinkering with the techniques, adjusting them when they didn't work the way he thought they should.
What Alan had discovered that made him so successful was that it's the ability not only to look at the market each day and see what others don't, but also to use a simple, predictable, repeatable process to exploit what you see. It's a combination of instinct and technique. And because of these two factors, there are swing traders.
..and then there are what some call master-level swing traders.
That's the opportunity we're giving you to enjoy. Since Alan has discovered the key to being a big winner mdash; and becoming one himself mdash; he has turned his passion to helping other traders secure their own fortunes. You can learn more about his methods as you read on.
Let Alan Farley teach you to see what he sees mdash; that constant market imbalance creates predictable, high-probability, but hard-to-see trade setups. Yet like with patterns of color that reveal photo images when viewed correctly, you can learn to see these opportunities like Alan does and take advantage of them before others see them mdash; and before they disappear. Traders who learn swing trading's singular way of seeing predictable market patterns can make money that other traders never know is there.
Before others ever see the setup, you've taken your profits and moved on. It's all about staying one step ahead of the crowd, and competitively outwitting the market. By following clear analytical charts you can learn to avoid emotional actions and find the hidden "execution zone" where you trounce skittish investors who trade en masse at the rise or drop of a point.
That's the most predictable, frequent way to uncover uncommon and consistent Pattern cycles keep you focused on unemotional (and therefore often profitable) investing. These cycles recognize that markets travel through repeated bullish and bearish conditions in various time frames. They're fueled by the eternal market motivators mdash; greed and fear mdash; at every stage of price development.
Prices fall and fear releases discounted equities into patient value hands. Prices rise and mindless greed bids up hot shares into the pockets of momentum players. On and on it goes through all markets and time frames: the emotional crowd generates constant price imbalances that swing traders can exploit.
But successful execution requires precision in both time That's where The Daily Swing Trade by Alan Farley becomes your essential guide. You don't have to be a "master" already, because The Daily Swing Trade by Alan Farley gives you valuable tools that guide you through the market every day. A combination of fundamental and technical analysis forms the backbone of Alan's swing trading methods.
3-D charts are your maps, and pattern cycles are your guides, all found in The Daily Swing Trade by Alan Farley. A swing trading example: In this hypothetical example, on Friday October 12, Juniper jumped 26% on three times its average daily volume to a price of $21.50 mdash; a 62% bounce off its prior freefall.
This kind of big volume spike is a call to arms for swing traders who try to spot these types of opportunities. The new price target is its pre-sell-off point of $29. While a momentum player might jump in immediately, the swing trader stands aside and takes a close look at the charting landscape.
This jump carried Juniper to about $21.50, a 62% bounce off its August to The horizontal line in the chart showed strong resistance, but if a market can break it cleanly, odds favor a rally all the way back to the beginning of the prior selloff. For Juniper, this meant a healthy price target of $29.
Not bad for a trade you might put on for one to two weeks. A normal bear bounce would predict a rollover to the downtrend at this resistance level. But the powerful volume you see in the chart shifts the dynamics so that a breakout above resistance becomes the A swing trading example: strong gaps are a trader's best friends mdash; or worst enemies.
This swing trade setup has two gaps, one above and one below the October 12 range. Swing traders can profit from the strong vertical movement the gaps create. Now note the gaps.
Strong gaps are a trader's best friends mdash; or worst enemies. For this setup you had two gaps to work with, one above and one below the October 12 range. One might say that the price was caught between an irresistible force and an immovable object.
Sure enough, a trader who jumped in at around $20.50 would have seen Juniper's price rise to about $27 by October 24, for a 32% increase in just eight days. That's close enough to the $29 target, and time to take profits and start looking for another setup.
.. In late October, 2001, overextended Viisage Technology (VISG) showed good accumulation and a bullish pattern, plus a setup that wouldn't force you to trade through a test of the October high.
A swing trading example: Note the drop just before the October 4 rally, and then the second drop. Perfect conditions for a sudden price move. Viisage is overextended, to be sure, but a knowledgeable swing trader knows that you just need one price bar, as long as it's a big one.
And by looking at the chart above, a swing trader might expect that big one to show up, because a pattern is clear, as shown in the drop just before the October 4th rally and then the two weeks up through October 22. These are perfect conditions for a sudden and violent price move. But keep in mind that this is a swing trade, not an investment.
What Alan would teach you is that you need to locate a safe exit now in case the price doesn't go in the expected direction. In this hypothetical example, a swing trader might see that the past seven sessions are confined within a narrow parallel channel. A swing trader can use this convenient pattern to manage an entry.
The trick is to buy in one of three places: at the bottom of the channel, within narrow bars at the top of the channel, or right above the channel if Viisage breaks through it. With the right charts you'll be able to plan your exit before making the trade so you can calculate your potential reward. In the hypothetical case of Viisage seen above, that outside day on October 16 would have trapped a lot of weak hands.
A swing trader would not want to stick around and find out how badly he wants out of this stock. So the swing trader's first target is on October 14, the top of the bounce right after the sell-off. You could have taken your money there, or tightened up a trailing stop and watched for a breakout over that number.
If you got it, you'd want to exit as soon as you get one long intraday bar above October 14. Why? Because that's exactly where you should expect the sellers to come in.
It may sound complicated and, frankly it is. But that's why TheStreet.com created The Daily Swing Trade by Alan Farley.
If it were simple, everyone would be doing it. But with The Daily Swing Trade by Alan Farley you get Alan's picks and setups, plus fully explanatory commentary, charts, and analysis. As a member of The Daily Swing Trade by Alan Farley, you get setups like these almost every day, with daily guidance from Alan that teaches you what to do and why to do it.
Follow his setups and commentary every day, and soon you'll be able to learn Alan's swing trading techniques. by Alan Farley. By way of introducing you to this exciting members-only service, we've created this special offer: you're invited to benefit from Alan Farley's picks and commentary for 14 days, absolutely free.
1. Up to 5 of Alan's swing trade picks a day. Alan uses his sophisticated custom computer technology to review thousands of stocks each day for you, to find just the few that might meet his demanding criteria.
With his own proprietary Master Swing Trader techniques, you can discover a new way to trade successfully. 2. Technical charts and analysis not found anywhere else.
Many websites will give you charts. But only with The Daily Swing Trade by Alan Farley will you get detailed charts that will show you the hows, whens, wheres, and whys of each of Alan's picks. 3.
Daily commentary and instruction on swing trading. No matter how much you know about swing trading and investing, you'll learn something new every day from this master trader and educator. He's well known throughout the investment community for his insights and ability to give clear, concise instruction.
4. Website archives of charts and commentary. You'll be able to look back at past charts to check your positions with the website's easy-to-use directory of charts, issues, and commentary.
5. A valuable handbook of 30 Rules for the
As an added bonus, you'll get three examples of Alan's ideal setups, with detailed charts and 7. A chance to try it all for 14 days FREE. With no obligation, you can get a 14-day free Or, call 1-866-321-TSCM (8726), Monday-Friday, 8am-6pm ET; outside the U.
S. and in Canada, call 1-212-321-5200. Act NOW and receive 2 valuable, exclusive swing trading guides FREE!
Alan Farley is a freelance writer and a contributor to TheStreet.com's RealMoney. TheStreet.
com is a publisher and has registered as an investment adviser with the U.S. Securities and Exchange Commission.
At the time of publication, Mr. Farley will not have a position in any security that he discusses in The Daily Swing Trade. HOWEVER, MR.
FARLEY MAY ENTER ORDERS TO PURCHASE OR SELL SECURITIES MENTIONED IN THE DAILY SWING TRADE AFTER 10:30 A.M. ET ON THE TRADING DAY FOLLOWING THE DATE ON WHICH THE SECURITY IS MENTIONED IN THE DAILY SWING TRADE.
IF YOU ENTER ORDERS TO BUY OR SELL SECURITIES AFTER 10:30 A.M. ET, IT IS POSSIBLE THAT MR.
FARLEY MAY HAVE PURCHASED OR SOLD THE SECURITY AT A PRICE MORE ADVANTAGEOUS THAN THE PRICE YOU WILL OBTAIN. The Daily Swing Trade contains Mr. Farley's own opinions and is provided for informational purposes only, and no mention of a particular security constitutes a recommendation to buy, sell, or hold that or any other security, or that any particular security, portfolio of securities, transaction, investment strategy is suitable for any specific person.
You further understand that Mr. Farley will not advise you personally concerning the nature, potential, value or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. To the extent any of the information contained in The Daily Swing Trade may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person.
Mr. Farley's past results are not necessarily indicative of future performance.
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