Swing Setups

I’ve been doing a lot of reading on swing trading, especially the blogs of Trader Mike and Taz Trader. Taz Trader’s strategy really intrigued me especially about the area he calls the TAZ.

“The Traders Action Zone (TAZ) is a buy and sell zone on a chart that swing traders can use to identify possible reversals in a stock. This is just simply "area" that we look at to see if a stock that is in a strong uptrend, after pulling back to this area, will likely reverse.” TAZ

This area is located between the 10 sma and the 30 ema. For entry into a stock we are looking for specific pattern once in this area. We are looking for the first candle makes a low, the second candle makes a lower low, and the third candle makes a higher low. This will be clearer once you see the charts below.

I added this scan to the program I’m developing, Market Ninja, and came up with following charts. A new trailing stop needs to be developed as TAZ's exit system wont work for the selected stocks. Initially I'll just put the stop loss below lowest of the three setup candles.

This is just a learning exercise, so hopefully I have the setups correct. I think DMX might be the closest to the setup required as the higher low was below the 10MA. CIR had a close below the 30EMA, not sure if that counts that one out. TAZ Trader does mention he likes the pullback to be closer to the 30EMA and this was the closest I could find. Also be aware some of these stocks have low volume, and after doing some back testing don't perform as well as high volume opportunities, but we'll follow the trades anyway.

COZIRON RESOURCES LIMITED (CZR)



Last close at $0.80, Stop loss $0.74

DOLOMATRIX INTERNATIONAL LIMITED (DMX)



Last Close $1.17, Stop loss $1.08

KIP MCGRATH EDUCATION CENTRES LIMITED (KME)



Last Close $1.42, Stop Loss $1.37.

CIRCADIAN TECHNOLOGIES LIMITED (CIR)



This one has a slightly different setup, but we'll follow it anyway.
Last Close $1.70 , Stop Loss $1.66

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Landed in Miami

Well I've landed in Miami and unfortunately my luggage is still in Sydney. 8th trip in USA, 4th time my luggage didn't make it all the way with me. Hopefully it arrives tomorrow.

We had some good moves in some our opportunities.

Industrea – IDL
Closed at $0.335, with an intra-day high of $0.345 reached past two days. Stop has been moved up to $0.31

Eastern Star – ESG
Closed at $0.335 with an intra-day high of $0.35. Stop stays at $0.275.

Charter Hall – CHC
CHC closed below our stop loss on the 31st. Trend still looks in tact with the guppy MMA and I'm inclined to watch this one over the next couple of days instead of enforcing the stop.

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Super Bowl XLI

Well I'm going to be attending Super Bowl XLI this year in Miami. Flight leaves tomorrow. I'm lucky enough to have a job that flies me to the USA every 3 months or so to work in stadiums and arenas. Although I will be on-call during the game, most of the work is completed before hand so I'm hoping for a nice relaxing day watching one of the biggest sporting events in the world.

I should be back in 3 weeks time. Hopefully I will still have time to maintain Market Ninja, so keep checking. It's been a very down month so far but thats trading. If it was easy, every one would be doing it.

Here's to a better February, and go the Bears. My Chargers fell short this year in the play offs and will better for the experience next season, like my first month posting.

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AUSTIN EXPLORATION LIMITED - AKK

Well the bad run continues, AKK closing at $0.85 today below our stop loss of $0.89. The trend still looks strong, maintaining it's trend line.

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