2013issue C0258-59
Stacked swing lows and breakout retrace tests
The archive reduces discretionary entries to two families: expansion through a prior barrier, or a return to that same barrier after the expansion. Editorial reading upgrades those ideas only when swing-point lows stack at one price on more than one chart scale.
- Discretionary entries fall into two families: initiate when price expands through a prior barrier, or initiate when price returns toward that same barrier after the expansion.
- A retrace-test is defined only after a prior breakout; a completed bullish retrace approaches the former breakout area, holds, and reverses away.
- Clustered swing-point-lows at one price are treated as a violation zone that can produce a fast move lower, not as ordinary support.
- The less common upgrade is multi-scale-alignment: the same stacked-swing cluster on daily and weekly charts that show a comparable number of bars.
Two families of discretionary entries
The archive reduces discretionary entries to two families. One family initiates when price expands through a prior barrier. The other initiates when price returns toward that same barrier after the expansion.
A swing-chart is a bar-based map of swing-point highs and lows used to mark the price areas that later define tests, holds, and violations. Support and resistance start as a prior swing, line, or other technical area that price first reaches. Once exceeded, the same area becomes the reference for a later retrace-test.
Breakout and the later retrace-test
A bullish breakout is described as price first tagging a prior resistance area, whether a swing point, a drawn line, or another technical zone, then trading through it. The bearish case is the same sequence inverted.
A breakout is a close or thrust through a previously identified resistance or support area. After that event the trader either participates with the expansion or waits for a return to the broken level.
A retrace setup is defined only after a prior breakout exists. A completed bullish retrace is described as price approaching that former breakout area, holding, and reversing away. A completed retrace-test is that hold at the area followed by a reversal away from it.
Stacked swing-point lows as a violation zone
On the daily S&P 500 chart, two swing-point lows share the same price area on April 10 and April 23. They are treated as a violation zone that can produce a fast move lower rather than as ordinary support.
A swing-point-low is an algorithmically marked trough on a chosen scale. Clustered or multi-scale copies of the same trough are treated as a shared failure zone if price trades through them.
The same stack on more than one scale
The March 6, 2012 swing-point low is identified as coinciding on both the daily and weekly S&P 500 charts. The weekly chart also marks short- and intermediate-term swing points near 1340.
The less common setup isolated in the case study is the same stacked-swing concept repeated across more than one time frame. It is shown by pairing a daily and a weekly S&P 500 chart that display roughly the same number of bars. Multi-scale-alignment is that same swing-point cluster appearing on more than one time frame.
Editorial reading treats that multi-scale stack as the upgrade condition for the two-hypothesis filter, not as a separate trade type.
All readings on this track · 30 readings
- 1982Constructing range resistance from harmonic swing divisions
- 1984Gold swing chart: failed highs, wash-out, and a boxed pivot range
- 1988Remaining life on a percent-filtered swing chart
- 1991Ranking turning points with percentage swing filters
- 1991Five-count swing-chart construction and break rules
- 1992Constructing the Gann quarterly swing from the prior quarter's intraday range
- 1992Audit quarterly swing breakouts with a slower average cross
- 1992Weekly swing invalidation and the trailing stop
- 1992Quarterly swing chart construction and trend duration
- 1998A two-bar swing is unfinished until it names the stop
- 1999Multiple time-frame swing-channel trade setups
- 1999Separate two-bar swing direction from peak-valley trend
- 2000Constructing peak-trough swing reversals
- 2002Swing charts as shared grammar for trading mentorship
- 2002Confirming the last leg of a zigzag trend filter
- 2004When a late trend bends: test the pause before sizing a reversal
- 2006Crude oil swing counts and cycle clusters
- 2006When late rallies flatten: a swing-chart classroom
- 2006Relocating trading certainty to the decision process
- 2008Swing highs, bar-count pace, and the cost-price stop
- 2010Constructing suspect versus confirmed swing trends
- 2010Constructing swing charts from clear bar ranges
- 2010Building price force maps from two-bar swings
- 2010Clear-method swing-chart construction
- 2011Treat a squared-chart swing forecast as a same-day hypothesis
- 2012Cycle mode construction from aligned bandpass swing waves
- 2013Stacked swing lows and breakout retrace tests
- 2015Building swing charts from perceptually important points
- 2015Construct a zztop from perceptually important points
- 2016Isolating swings with percentage trend thresholds