Timing Solutions for Swing Traders: A Novel Approach to Successful Trading Using Technical Analysis and Financial Astrology

DETERMINING YOUR TIME FRAME

First and foremost, ask yourself, “How much time will you have to trade?” This will determine the type of trader you are going to be—a day trader or an end-of-day (EOD) trader. An EOD trader, or swing trader, can buy and hold a stock for a week or even up to a few months. Becoming a swing trader is the preferred choice for most traders who are using end-of-day data. Those who buy and hold stocks for years are known as position traders or long-term investors.

The next question is to find out how are you going to trade—will it be discretionary trading or system trading? The type of trading will define the time frame. Active traders who enjoy a fast paced style would not find much action in weekly or monthly time frames, while less active traders generally find that the extremely short time frames are too tedious or take too much of their time. Decide which style best suits your personality, and then select the corresponding time frame.

One important reminder, regardless of whatever time frame you are going to trade in, you have to do homework. You have to do your analysis outside of market hours, because when the market opens, you will not have sufficient time to think and deliberate on the course of your actions.

Since the data used in this book are end-of-day data, the book addresses issues from the view of swing traders, and the trading methodology adopted is a combination of mechanical system trading and discretionary trading, as outlined in Chapter ...