Truly, swing traders use MACD indicator, stochastic oscillator, moving averages,RSI indicator, CCI and many other technical indicators. If one masters the CCI indicator, one can use it for swing trading.
However, if one is more competent in using moving averages,
one will prefer them. In my experience, there is no better technical indicator than the naked price action itself. It has no equal. Above all the price action does not hide anything.
It is the leading technical indicator that one will ever come across in the financial markets.
If one wants to buy or sell in a timely fashion, one must use direct trading signals. A direct trading signal is a price action signal
. That is why technical traders that are using candlestick patterns
, Elliott wave patterns
fractal patterns are far ahead of those that are relying on ordinary technical indicators.
Indeed, every other technical indicator gives signals, but those signals must be confirmed by the price-action because they are just warnings.
Take for example MA 50 crossing above MA 200 on the daily chart. It is a warning that the bullish momentum is likely to increase, but it is not set in a stone. Otherwise, everyone can trade successfully.
That bullish momentum is validated when the price forms a higher low at a support level above the intersection point of the two MAs.
So at the end of the day, it does not matter which technical indicator one is using, it is more to do with whether one is using the technical indicator more efficiently; and one also confirming any warning with the price-action.
The warnings are signals given by technical indicators. Yes, one can successfully use any technical indicator as a swing trader if one also knows how to adhere to the trading drill.
The swing trading drill is about finding first a high probability swing trade, then wait for the signal on the signal time frame, and entering the trade on the entry time frame.
To cut all nonsense, the best technical indicator for swing trading is the whole price action, nothing but the price-action.
Please do not feel overwhelmed by what I have just said. It may be challenging for beginners to fully master the price-action trading. Slowly but gradually, technical traders who just want to understand the message that the price-action and price structures are sending out will reach that level as they continue to learn to interpret the price-action.
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Happy Swing Trading To All.
This article is written by G. Beaulieu
Founder of stochastic-macd.com.