![]() ![]() ![]() Why are swing high and swing low formed?Ī swing high and swing low is formed due to what is known as support and resistance. The advantage of using the swing high and swing low is that you are able to define the trend by just looking at these patterns.īut you might be wondering why a swing high and swing low is formed in the first place. This is nothing but using swing high and swing low in order to understand the trend. Now the trend is clear when you look at the 10-period moving average. Swing high and low and the moving average to understand trends Now let’s add a moving average to the chart above to get a better picture. You simply look at the swing highs and the swing lows. So how can we capture the uptrend as price tends to make higher highs and lower lows? However, as you might figure out, this is only in hindsight. This pattern tells you that price is in an uptrend. Capturing trends with swing high and swing low Subsequently, price tends to make swing highs and lows, each of which is higher than the previous one. Now if you look close enough, you will see that the swing highs identified by the fourth and sixth flag are formed almost at the same price level. What’s more! The second swing low marked by the flag shows that it is a higher low compared to the first flag. This tells you that the market is trend higher. For example, starting with the first flat on the left side, you can see that after the swing low is formed, price tends to move higher. The above is an example of a very microscopic look at the swing high and swing low.įor intraday traders, the above chart can reveal quite some information. Following the high and the low, the next subsequent sessions form a two consecutive lower high or a higher low. The flags depict the point when price makes a swing high or a swing low. The flags at the top and the bottom show the swing high and swing low. What you see in the chart is a 5-minute chart for APPL. It would be worth a read as it talks about the basics of fractals so you have a better understanding.īelow is an example of a Sierpinksi Triangle from this website. This research article gives a basic insight into fractal geometry. Undoubtedly, there is a lot of math involved and there is a specialized field in the study of fractals. A good example is that of a snowflake where the fractal pattern occurs as you zoom in. Each part has the same statistical character. Well, fractal is defined as a curve or a geometric figure, according to this entry on Wikipedia. Whether you look at a 5-minute chart or a weekly chart time frame, swing highs and swing lows are easily identifiable. What this means for you is that, understanding how swing high and swing low works enables you to swing trade or day trade the markets.Īnother aspect to bear in mind is the fractal nature of the swing high and swing low points. What’s even better is the fact that swing high and low can be applied to any time frame. Swing high and swing low are common to all charts and therefore, the concept can be applied to any market. With swing high and swing low you can ride the trend or even trade the market that is stuck in a range. ![]() When you understand how to use this information, you can easily play with different trading strategies. As price tends to flip-flop as it trends higher or lower, you are seeing the swing highs and lows forming.Īs a day trader, swing high and swing low can reveal important market information. Pull up any chart across any market and you will undoubtedly see the zig-zag fashion. Why use the swing high and swing low method?. ![]() Trend trading with swing high and swing low.How to use swing high and swing low in your trading?.Why are swing high and swing low formed?.Capturing trends with swing high and swing low. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |