Indicator Rules For Swing Trading Strategies, Part 1 by Sylvain Vervoort
One Step At A Time
In today’s volatile markets, making money consistently
is a challenge. You need a good strategy with
reliable trading rules. This seven-part series will
discuss such a strategy and its trading rules. In this,
the first part, an overview is presented.
Too many people believe that if they could
just get their hands on some secret trading
rules, making money in the stock market will
be easy. You can’t blame them: They want to be like
that trader who effortlessly made more than 100 pips a
day using a fully automated forex trading system. On
the other extreme, there are people who say that if you
want to be a successful trader, you have to spend long
hours studying and analyzing the markets.
Which side should
you be on?
If you want to be successful
in anything, you need to
work hard. But your time
and effort should be well
spent. For example, if you
spend your time studying
fundamentals, it will likely
make you money in the long
term, in a sustained up or
down market. But in volatile
markets, you may not make
money consistently. This
may tempt you to turn to an
automated trading system,
but think about this: Would
you sell a system that consistently
generated, say, $5,000
profit each month?
Before you can make any money, you need a trading
strategy with reliable trading rules that has been
shown to make money in backward and forward testing
using historical data. To do that, you need to learn
the basics — that is, technical analysis, money & risk
management, and trading knowledge — and you need
to gain experience.
I am going to put you on the right track with my
indicator rules for a swing trading strategy (IRSTS). It
will take a series of articles to demonstrate and explain
the strategy. I will also introduce some new indicators
that I use in my trading. Let’s start with an overview
of the IRSTS strategy.