Thread by @SRxTrades

My first 2 years day trading, I lost -$10,000

Tired of poor results I started swing trading and that's when everything clicked for me

Fast forward 4 year and now I make over $50k/month swing trading

Below you can steal my exact swing trading strategy:🧵

To start off, we have to understand the point of this strategy...

The goal is to make trading super simple and repeatable

We want to take advantage of strong market trends & use the leverage of options for a low risk high reward approach

Using big momentum swings in the markets we can catch the biggest moves and ride strong trends

1. Establishing market trends

The easiest way to find market trends is to:

Pull up a chart on

and add the 8, 21, 50 EMA's

EMA's can be used as a momentum gauge for when the markets are trending or choppingtradingview.com

Now that we have the EMA's on the chart, we can make some rules for when we want to be active in the markets.

Use $SPY / $QQQ

Whenever $SPY / $QQQ are above the 8/21/50 EMA's, we want to be long with full size/conviction

Whenever $SPY / $QQQ are below the 8/21/50 EMA's, we want to look to short or avoid trading due to unfavorable conditions

We can also use this on the individual names we are swing trading to narrow down our criteria.

Stocks above moving averages = strong trend

2. Finding the best stocks in the market

Easiest way to scan for leading stocks and themes is to use: tradingview.com

Click on screener

We want to narrow it down to search for liquid stocks that are leading the market higher on volume

Here are the parameters I use in my scan:
(This one simple scan found me the best stocks this year)

Price: Over $3
Market cap: Over $300m+
Average volume: Over 500k
Change: Over 0.01

And most importantly, the 21 and 50 EMA's below price to find leading names

Now we have some of the strongest and most liquid stocks in the market

Sort the list by volume descending

This scan narrows down our search to only 200-300 of the BEST stocks in the market that are leading with volume

4. Setup

Scan through these stocks and look for a chart that is setting up in a tight base with a tight pattern forming.

The goal is to find names that are either just breaking out or about to breakout of tight bases

Use this formula
1. Tight pattern or base
2. decreasing volume on consolidation
3. Setting up above the moving averages

Below are some examples of setups I look for

A name that caught my attention on my scan: $SMR

The stock is breaking out of a big weekly base

Setting up in a tight daily wedge off the 21 EMA

Volume is decreasing as price consolidates

Clear level breakout level to use

5. Entry

The easiest way to enter it to find a trigger level for the breakout

What I look for, is a previous level of resistance that price has rejected multiple times

In this example, you can see the $38 price level has rejected multiple times

Confirmation of the breakout is VOLUME

You must see volume on the break of the key level to enter

Entry is taken on a break above the trigger level

For confirmation, we want to see high volume on a break out of the base.

For example $COIN recent base breakout:

Leading stock in an emerging theme (Blockchain)

SNP inclusion catalyst

Breaking out of a tight daily wedge

Enter long at the break above the the trigger level

We can use the 5m time frame to confirm our entry.

First 5m close above our level triggers long entry.

Use volume for confirmation

(In this example you can see $COIN was getting a ton of volume through the breakout level)

Stop loss is placed on the low of the daily breakout candle to make sure that we manage our risk in case of a failed breakout

(You MUST use a stop loss)

Don't hold and pray

if price gaps above your trigger

Wait for price to comeback and retest the breakout level

if it doesn't retest, wait for a new setup on the daily

never chase

7. Targets

Take profits at previous resistance levels

If price is making new all time highs, use Fibonacci levels to scale out.

I use 3 targets to scale out of the position

My scale out strategy is 25% of the position at a time and moving up stop to break even after first trim.

The last 25% of the position I trail using the 8 EMA to catch massive winners

This sets you up for a huge r/r trade

for breakouts we do not want the stock to comeback to our entry level

the strongest stocks will lockout traders and keep running like

this is why my scale strategy works so well to hold winners

The goal is to hold onto the trade until targets are hit or you are stopped out

This will help you make trading emotionless

Everything is preplanned and you are taking amazing risk to reward trades

Breakouts allow you to capture huge moves and using options contracts you can use the leverage they provide to risk small amounts of money for bigger hits

This works best when markets are very strong and setups are firing(above moving averages)

The reason this strategy works so well is because we are trading the stocks that are leading the market higher and emerging out of strong sectors and themes.

We are also taking advantage of the strongest environments in the markets when stocks are breaking out and following through

Like any other strategy this is not a holy grail strategy

but this is how the best traders in the world trade and buy leading stocks in leading sectors.

I've personally used this strategy to catch:

$OKLO
$QBTS
$QUBT
$RKLB
$HOOD

All up over 100%+ on the year

I post these setups every night on my twitter with trigger levels, option contracts, and targets.

So you can follow along, and learn the strategy.

If you enjoyed and learned something from this thread LIKE+RT❤️for more trade plans and educational threads.

I also make a full video on my strategy on IG:



Checkout this out and follow on IG for more educational content!instagram.com/reel/DMESctYxe…