20 40 Swing Trend Trade in direction of strong trend –(bull or bear) Can combine Swing and Trend trading Can be traded using any kind of time period (hourly, daily, weekly)

Criteria Find using a strong fundamental search –Higher highs and higher lows –Rising 20 and 40 period moving averages –Parallel 20 and 40 period moving averages –What is the trade direction of the 20 period simple moving average (20 SMA)? Bullish or Bearish? –Use a chart style showing you a 20 SMA, 40 SMA and 200 SMA

When to enter (1) Bounce: the price of the stock bounces at or near the rising 20 SMA and closing above the high of the low bar.

When to enter (2) Breakout: the price closes above the 20 SMA after bouncing off the 40 SMA.

Stop loss? Trend exit: –Stop loss is set to 1 cent below low of low bar Swing exit: –Stop loss is set to 1 cent below low of low bar Adjustments to stop loss Trend: –Move stop up when 20 SMA moves above initial stop or entry price

How to exit Trend: –If closes below 20 SMA –Or any of the stop losses are triggered Swing: –Sell at dip’s previous high –Raise stop to 20 cents below the days low. –Adjust stop up to previous high