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Introduction To Swing Chart

Swing charts disregard time and focus only on price movements, plotting higher highs and higher lows to show an uptrend or lower highs and lower lows to show a downtrend. They can be used to easily view overall market trends, position stop-loss and take-profit points using previous highs and lows, apply technical analysis without considering time, and create price channels to predict future price movements and aid trading decisions. Swing charts filter out noise and follow the current trend until it is broken, switching to the new trend.

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Praful Sharma
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237 views11 pages

Introduction To Swing Chart

Swing charts disregard time and focus only on price movements, plotting higher highs and higher lows to show an uptrend or lower highs and lower lows to show a downtrend. They can be used to easily view overall market trends, position stop-loss and take-profit points using previous highs and lows, apply technical analysis without considering time, and create price channels to predict future price movements and aid trading decisions. Swing charts filter out noise and follow the current trend until it is broken, switching to the new trend.

Uploaded by

Praful Sharma
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Introduction to Swing Chart

These lines keep swinging up and down, these charts are called swing charts Disregard time factor Does not consider opening and closing prices Only absolute price action and consider only high and lows of the price movement Effectively eliminate the noise Making higher highs and higher lows - Up trend Making lower highs and lower lows - Down trend Help you keep up with the trend. It is trend following indicator it is not used to predict prices
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How does it work?


Swing charts plot a line on the chart, following the current trend until it is broken and then switching to follow the new trend. When the candle makes a Higher High, the swing chart line will now begin plotting an upwards-sloping line. This line will continue following the up-trend until such time that the candle breaks the up trend by forming a Lower Low, the swing chart will now begin to follow the downtrend and plot a downward sloping line.

Using Swing Charts


To easily view the overall trend of a market or equity - Trends can be discerned by simply looking for progressively higher highs and lows (which form a stair-like pattern) or by drawing trend lines. To easily position "stop-loss" and "take profit" points - Previous highs can be used as takeprofit points, and previous "step" bottoms throughout a trend can be used as moving stop-loss points.

To apply technical analysis techniques that are not time sensitive - For example, Fibonacci
levels can be calculated, or Elliott Waves can be applied. These can often help you predict where prices are headed, or can help you place more effective take-profit and stop-loss levels.

To create price channels These can be developed by connecting consecutive highs and consecutive lows. This can help predict prices, place moving take-profit and stop-loss points, or help you liquidate or add to a position in a timely manner.

Placing lines that connect highs to highs and another connecting lows to lows creates a channel through which the price moves.
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Construction of Gann Swing Chart

Filtered Waves
Swing Chart At 5% Filtered Rate

Swing Chart At 10% Filtered Rate

Swing Chart At 15% Filtered Rate

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Conclusion
Swing charting is a viable tool for trading and making investment decisions. It covers all the basics: stay with the trend limit losses follow well-defined rules

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