Swing Trading: Equities

Status: Scaffolded - Content pending Last Updated: 2025-12-11

How Equity Swing Trading Works

When you request a SWING trade on a STOCK, the algorithm looks at 60 days of hourly data to capture the full swing cycle context.

Data Collection

Data Type	What We Get
Current Price	Real-time snapshot
Historical Bars	60 days of 1-hour candles
Bars to AI	200 most recent hourly bars
Indicators	RSI(14), EMA(9,20), SMA(50,100,200), MACD
Previous Day	PDC, PDH, PDL
Market Context	SPY, QQQ, VIX direction

Analysis Flow

1. Data Collection (60 days, 1-hour bars)
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2. Technical Agent analyzes:
   - Support/Resistance (2-3 week swings)
   - Major moving averages (50, 100, 200 SMA)
   - Monthly/Quarterly high/low
   - Chart patterns (flags, wedges, H&S)
   - Multi-timeframe alignment
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3. Macro Agent checks:
   - Market regime
   - Sector rotation
   - Economic trends
   - News sentiment
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4. Wild Card Agent checks:
   - Earnings date (if within holding period)
   - Fed meetings
   - Sector-specific catalysts
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5. Supervisor synthesizes:
   - Entry zone
   - Stop loss (guardrail typically $2.00-$3.00 on liquid equities; anchored to major structure + volatility)
   - Targets (typically $4.00-$6.00 and $8.00-$10.00, anchored to resistance/trend)
   - Position size
   - Time stop (3-5 days)

Entry Methodology

Swing Trading Entry Process:

1. Identify the Trend — Is the stock trending or ranging?
2. Find Key Levels — Weekly support/resistance, major SMAs
3. Wait for Pullback — Enter on retracement, not extension
4. Confirm with Volume — Volume should support the move
5. Check Macro Alignment — Sector and market should support direction

Position Sizing

Risk Amount = Account Size × Risk Percent
Shares = Risk Amount ÷ Stop Distance

Example:
- Account: $100,000
- Risk: 1% = $1,000
- Stop: $2.50 below entry
- Shares: $1,000 ÷ $2.50 = 400 shares

Exit Rules

Condition	Action
Price hits Target 1	Exit 50% of position
Price hits Target 2	Exit remaining 50%
Price hits Stop Loss	Exit 100% immediately
Time Stop (3-5 days)	Reassess or exit

Key Levels for Swing Trades

Level	Significance
50 SMA	Intermediate trend support
100 SMA	Major trend support
200 SMA	Long-term trend support
Monthly High/Low	Key swing points
Quarterly High/Low	Major inflection points

What the Trade Plan Looks Like

Direction: LONG
Entry Zone: $175.00 - $177.00 (50 SMA support + prior resistance flip)
Stop Loss: $172.00 - $173.00 (below 100 SMA)
Target 1: $182.00 - $184.00 (50% of position)
Target 2: $190.00 - $192.00 (remaining 50%)
Time Stop: 5 trading days
Position Size: 400 shares
Max Risk: $1,000 (1% of account)

Swing Equity Checklist

Before entering:

• Clear multi-day trend identified
• Price at key support/resistance level
• No earnings within holding period
• No major Fed meeting imminent
• Sector aligns with trade direction
• Volume confirms the setup