A Short Course on Swing Trading: KISS: Keep it Simple and Short

Bhaskar Rimmalapudi

 My Favourite 5 Indicators
1. Super Trend
2. Donchian Channel (DC)
3. Relative Strength Index (RSI)
4. Moving Average, Convergence and Divergence (MACD)
5. Elders Force Index (EFI, Force Index)

 Create Watchlist Before proceeding further

1. Watchlist 1: Nifty 500 stocks (to get started you can try Nifty 200 stocks too)
2. Watchlist 2: Selected Stocks
3. Watchlist 3: Stocks in which you have Position

 Selecting Momentum Stocks

When momentum is building up in stock, in most of the cases, volumes associated
with it also increase, thus creating interest in traders. We have gone through few
indicators earlier in this book,
1. Relative Strength Index - Momentum Indicator
2. MACD - Momentum Indicator
3. Super Trend - Volatility Indicator
4. Donchinan Channel - Volatility Indicator
5. Elders Force Index - Volume Indicator

To take a swing trade, all the above-mentioned indicators should be aligned on a

Daily Timeframe to our Golden Rules

 Golden Rules
1. Price should be greater than Super Trend
2. Price should be greater than Donchian Channel, Mid Point
3. Indicators separated from Price Charts
4. RSI should be greater than 60
5. MACD should be greater than 0
6. EFI should be greater than 0

 When to Buy
1. Step 1 : Select a stock from Watchlist 1, if RSI line crossed above 60 line
today, we give the highest priority to RSI crossing above 60 add this stock to
your Watchlist 2

2. Step 2 : Consider Watchlist 2 as a priority list and keep an eye on these every
day If the rest of the Golden Rules are aligned by the end of the day, place a
buy order

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 A Short Course on Swing Trading: KISS: Keep it Simple and Short
Bhaskar Rimmalapudi

3. Step 3 : Once buy order executes, move the stock to Watchlist 3

 Exit Criteria
Similar to the rules of the entry criteria, we have Golden Rules for exit criteria to sell or close
our position
1. Method 1 : When price closes below Super Trend, exit the stock Closing below
super trend is important.
2. Method 2 : Follow INDIA VIX index, this index tracks broader market volatility
Take a note of Donchian Channel [55 period] mid value of VIX on the day you buy
stock, say value is 16 If the value of is 16, then consider taking 16% profit and -8%
loss. It’s a Risk: Reward ratio of 1: 2 i.e., 8:16, if -8% loss on your trade then exit, if
16% profit then exit. This is purely based on 55 period average value of VIX,
wonderful method for traders.

 Filter screen
Set the following in TradingView Screener ( https://in.tradingview.com/screener/ )
1. Exchange: NSE
2. Volume (30 days) > 500K (I would recommend 1M)
3. Relative Strength index (14) > 60 (Crosses Up)
4. MACD Level > 0 (Zero)

With these parameters, half the job of screening is done. Daily at the end of the day,
we should be seeing around 30+ stocks in a normal up-trending market. There may be
days when no stock is displayed, I am happy that it was a bearish day and will be a
“no workday”

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