Example - Swing Trading - Volatile Stock Microtrend Trading, Introductory Notes

[vchandra11 8]

Hi there

I am sharing a sample watchlist and sample chart setup for swing trading volatile stocks for microtrend-term. The methodology contains/combines information generally discussed in the intermediate-term and short-term swing trading plans posted earlier. The watchlist is prepared with scan criterion of stock HLVolatility ( > 5%), Beta ( > 1), ATR ( > 2.00) and 50-day average volume ( > 4M) on Thinkorswim. The chart set-up incorporates exponential moving averages on 1-hour time frame. The chart includes at least 4 weeks of 1-hour data to identify potential support and resistance levels for potential exit points. This is for discussion purposes only. Please feel free to send comments/discussions so our BBT Forum can benefit from same.  The sample watchlist, charts and notes herein are based on information from instructor training, textbooks, Webinars, swing trading plans, and information available on the internet over last few years. One good point up front is to keep things simple and this seems to be working for me.

For further reading:

1. " 20 Most Volatile Stocks - This strategy is for experienced trader. .....This strategy requires you to be able to react to price momentum very quickly and is primarily for day traders, options traders, and some microtrend traders.......If you are using this strategy as a microtrend trader, you must use stops, for a microtrend trader will not hold one of these stocks over five days......The key to trading this strategy is to identify the trend strength and trade in that direction. " *

" Microtrend Trader: A microtrend trader by our (Deel's) definition is a trader who takes position with the intention of holding it for three to five days. The microtrend trader is attempting to trade a small part of a larger trend.... For microtrend trading to be successful the entry must be made when the trend is strong.  This usually occurs when the trend is underway or begins explosively. The momentum should carry the price for three to five days....After three to five days, the microtrend trader liquidates his or her position and looks for another microtrend. " *

* the strategic electronic day trader, Robert Deel, 2000, Published by John Wiley and Sons Inc.

2. Investopedia

In summary, and per Deel, the idea is to prepare a watchlist of volatile stocks for analysis at end of each week. After graphical analysis of the individuals stocks,  three of the most volatile stocks that are moving in a definable trend on daily chart are selected for trading during the following week. My trades will be for bullish trend for long trade. The attached example watchlist and charts are for last weeks trading (Jan 10-14). Examples thereon can lead you to further research, and as mentioned in earlier posts, it would prudent to have a mentor who can help you to prepare a swing trading plan for trading volatile stocks for microtrend-term. 

Please note this is not an investment advice. Please seek investment advise  from your own investment advisor. The attachments and notes are for illustration and discussion purposes only on our BBT Forum.

Examples - Swing Trading - Microtrend Trading - High Volatility Watchlist and Setup Examples.pdf