Tuesday, May 05, 2009

Swing trading chart

Above 60-minute chart is an example of a Swing trading pattern with two excellent tools, the False Bar Stochastic and Blue Wave Trend Model. The trading period is the past two weeks and the actual trades can be either a simple stochastic long/short model or the mechanical signals (shown on chart) from Blue Wave. The two models can also be integrated to filter the best, sweetest trades, but the table below summarizes only the BW-based trades, all basis the SPX:

Sell - 4/20 - 864.38..........+23.49
Buy - 4/21 - 840.89..........+ 9.71
Sell - 4/22 - 850.50..........+ 4.40
Buy - 4/23 - 846.10..........+13.36
Sell - 4/27 - 859.46........... - 2.30
Buy - 4/29 - 861.76.......... +16.54
Sell - 4/30 - 878.30.......... +0.09
Buy - 5/4 - 878.21........... +21.02
Sell - 5/5 - 899.23............ -4.57
Current - 903.80
TOTAL............................ +81.74

It didn't matter what I, nor anyone else, thought about where the market was going during this two week period. The Advanced GET software recognized this advance as a Wave 5 rally so its not surprising that the best performing trades were Buys, following the final decline of a previous Wave 4 decline, the Sell on April 20th, which ended up being the best trade of the lot.

There are so many ways to be a successful trader, almost none of which include following someone else's advice. But not all tools are created equal. The ones I use, the Triangles, Advanced GET, Blue Wave, have survived years of my buying and trying all kinds of tools and techniques, so those that are left are the ones that I believe work the best. Remember my mantra, "Find something that works......then use it."

My trade of the year will show up in my tools. In fact, they are designed just for such instances, the trade will not get very far without bringing me and my accounts along. When I am sure, or at least pretty sure, I'll bring all of you along too. It's too, too, full of potential not to share.


One of these Sells will be the one. We just won't know it at the time. But we will, soon enough thereafter.



Anonymous said...

I just wanted to thank you for spending the time it takes to do what you do here.

I read your blog almost daily and the people who bash you just don't get it.

It's not about blindly following you into each and every trade. What's really happening here, if your smart enough to see it, Is people are being TAUGHT how to trade and invest by someone who has been successful.

Alan....Keep up the work...It's good...Very good. I appreciate it and I know a lot of others do too.


Anonymous said...

Allan, After reading your post I really wanted to thank you for all you do.
However, I couldn't state it more elegantly than Pete just did. So I'll just say DITTO!

Doug in ATL

Anonymous said...


You could not have said it better.


Anonymous said...

The true silent majority speaks. Add me to that list.

Thanks for going above and beyond the call of blogger duty.

Many of us here are learning, and someday we will be able to express our gratitude by hitting that donate button and gladly share some of those winnings you brought into our realm of possibility.


Anonymous said...

Hi All,

I also want to say thanks for your fantastic blog and great ideas. I also use BW and the only query I have is that on your analysis on the SPX 60 minute chart you have used the value from the first blue bar for your entry

For example on 5/4 how would you know that a blue bar was going to be created at 878.21. If it is based upon when the price hits the stops you would have entered based upon the red bar on 5/1 which also hits the stop. As you know when using BW quite the price can hit the stops without trigering a change in the colour of the bars and then carry on in the original direction that the price was heading. However I do appreciate that the Stochastic would have given you added confidence

I am not trying to be picky but would be genuinely interested to know how you enter your trades using BW

Anonymous said...

So what vehicles would you recommend shorting when the move comes?

Anonymous said...



Newbie said...

anonymous,i'm leaning towards FAZ,SRS,SKF,DOG,DXD,SDS,anyone else with an idea?

Anonymous said...


How many waves in this wave 5? Normally how long will it last?