Swing Trading and Market Timing Knowledgebase

By: John Crane, swing trading guru

Projecting Market Timing

It is not necessary to draw a line through the center of the Reaction swing when using it to project future swing trade dates. In order to project future swing trade dates, you only need to know the date of the highest closing price and the date of the lowest closing price. The rules for this process in a downward trending futures market are as follows:

Identify a Reaction swing. The beginning of a Reaction swing will be the price bar with the lowest closing price prior to a corrective rally and the end will be the price bar with the highest closing price.
Start on the first day to the left of this lowest close: consider it as day one and count each day or price bar going backwards.
Continue to count each day or price bar all the way back to the lowest closing price of the pivot at the beginning of the previous Reaction swing. (It is important to remember to count back to the lows in downward trending futures markets.) This is called the reverse count.
If a holiday falls on a trading day, it must be counted even if the futures market was closed.
Go to the end of the Reaction swing (in a downward trending futures market it is the day with the highest closing price) and complete the forward count as explained in rule # 6.
Begin with the first day to the right of the highest close and count forward the same number of days or price bars equal to the reverse count. For example, if the reverse count was 15 days, count forward 15 days.
Mark the date on the chart as the next potential swing trade date.
Note: Reverse the rules in an advancing futures market.

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**THE RISK OF LOSS IN TRADING CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER-COMPENSATED FOR THE IMPACT IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT.NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES.