Tuesday, May 13, 2008

Pristine Swing Method

This is a method described by Oliver L Verez in his book, “TOOLS AND TACTICS FOR THE MASTER DAY TRADER”.

The method uses candlestick pattern and the relationship between the highs and lows of the price bar to determine entry points.

Entry Rules
1. Price made 3 or more consecutive lower highs
2. Price made 3 or more consecutive lower lows
3. Price made 3 or more consecutive black candle (closing price is less than opening price)
4. When conditions (1) to (3) are met, enter a long position at the high of the previous bar.

Exit Rules
1. Exit after holding the trade for 5 days.

Example of such a price pattern is shown below:




Lets apply this method to Digi.com Bhd (Symbol: 6947). Using data from 2003 to 9 May 2008, we have the following trades:




Entry DateEntry PriceExit DateExit Price% ChangeBars Held
5/18/20044.425/25/20044.51.815
10/8/200720.410/15/200722.610.785
11/26/200723.812/3/200725.758.195


No comments: