Swing trading FTSE100 members

This is partly a trade log, partly a strategy development. I aim to post here a simple and unoriginal swing trading method and apply it to the FTSE100 stocks. I won't be able to take all the signals that posted, but am looking particularly to refine exit strategy so feel free to contribute ideas and criticism. Comment on entiries too if you like, but they're by no means the most interesting part of swing trades. All based on EOD prices from Sharescope, though recognising daily highs and lows can vary between data sources and no account taken of bid/offer spread.

I will also be taking the opportunity to try out the trailing stops offered by Capital Spreads. I've repeatedly read that these are essential tools for traders but have never had the chance to set and forget these before now.

Chart set-up – as per Marc Rivalland’s swing chart scheme noted in his book on swing trading and available in Sharescope – HL bars: coloured blue if higher low and higher high, red if lower low and lower high, orange if both high and low are inside previous day’s extremes, and black if both are outside the previous. Ignore daily Closes.

Swing days in an uptrend are identified as the third or subsequent red day after a high. Inside days are ignored. Outside days count as the same colour as the immediately preceding day.

Swing days in a downtrend are identified as the third or subsequent blue day after a low.

Buy orders in an uptrend are entered at or just above the high of the swing low day. Only enter a buy based on this putative swing low if it would be at least the third successive higher swing low. If the order is not triggered because price made another red day or a black day, that becomes the putative swing low, so move the entry lower to the new high.

Sell orders in a downtrend are entered at or just below the high of the swing high day. Only enter a sell based on this putative swing high if it would be at least the third successive lower swing high. Move the order higher if the putative swing day is followed by another blue day or a black day.

Initial stops on a long are last 5 day’s Average True Range below the entry Ignoring inside days in ATR calculation). Initial stop on a short is ATR5 above entry. Stops set to trail in both cases.

Example for a long for tomorrow Monday 30/01 is BG. Buy at/above high of 27/01 1465.5, stop at 1465.5 minus ATR5 (33.9) = 1431.6.

Further potential signals to follow.

More possible signals for tomorrow –

BP. – Buy at /above 472.33. Initial stop -11.37 = 460.96
CRH – Buy at / above 1305.0. Initial stop -36.4 = 1268.6
EXPN – Buy at / above 890.0. Initial stop -13.5 = 876.5
IAP – Sell at / below 337.3. Initial stop +10.9 = 348.2
ITRK – Buy at / above 2138.0. Initial stop -29.2 = 2108.8
NXT – Sell at / below 2581.0. Initial stop +65.4 = 2646.4
PFC – Buy at / above 1495.0. Initial stop -36.0 = 1459.0
SGE – Buy at /above 299.68. Initial stop -6.54 = 293.14
SVT – Sell at / below 1523.0. Initial stop +27.0 = 1550.0
SMN – Buy at / above 980.0. Initial stop -16.6 = 963.4

I'll be following

Subscribed.

Question. Do you take any notice of which direction the general market is heading?

After today's negative performance by the index, unsurprisingly, all the potential Buys listed for today printed further down (red) days. All their lows remained above the previous swing lows so just move the entry price down to today's high and re-calculate the ATR5 for the initial stop.

The IAP sell order was triggered late in the day, although price had already travelled up through the initial stop if the position had been open. Ideally, breach of the stop before the position has opened would be a signal to cancel the order: at this point, with a higher high for the day already in, the session could only end as a blue day or a black day, either way making a higher putative swing high. In this case, price printed an outside day (black) so entry would be re-set down to the new low of 336.1.

NXT printed an inside day in orange, so ignore it and let the entry order stand.

SVT was a rogue signal owing to a messy chart, scrub this order. Sorry.

New potential swings for tomorrow to follow.

Hi China - No. These shares will either take the same path as the market, e.g. BP makes up so much of the FTSE index it is rarely seen going one way when the index is going the other, or they have a strong enough momentum to make the trade worth the risk. Worth the risk to me that is. You might want to feature a rule along the lines of no buy signals executed when the index is dropping. But I don't want to second guess what price will do, just react to what it has done.

Putative swing trades for 31/01 -
BA. - buy at breach of 315.0
CNA - sell 290.9
ENRC - buy 721.0
HSBA - buy 536.0
MKS - buy 331.7
RR. - buy 741.5