1. VectorVest User Group June 2014
Written and presented by David William Paul

2. Dow

3. Dow

4. Dow
1300 pt target from
the ascending triangle

5. Euro$

6. $ CAD
Daily falling wedge
Always a good bet

7. Aussie H4

8. Gold

9. $ Rand
More Rand weakness on the way

10. VV Composite SA

11. VV Composite SA

12. Telkom

13. My Swing Trading Method
• The method has rules for
• 1. what share
• 2. Entry
• 3. Exit
• 4. Position sizing

14. Swing Trading
• Stock selection
• I only swing trade “Long” in shares that have good RV
values above 1.25 and acceptable RS numbers
• What's unacceptable to me may be fine for you.
• I am travelling to much for lots of surprises and like RS
numbers about 1.15 at the very minimum.

15. Swing Trading
• The technical position of the overall market is vital
• If the overall market is rising that’s the best and only
time to be taking long position.
• Clearly the opposite is true for shorts.
• If the VV composite is above a 200 day moving
average and VV has given a confirmed call then I
want to be in long only trades.
• Conservative I know but that’s MY plan

16. Swing Trading
• The basis of my trade is the AB=CD pattern
• I like to see a pullback to an old high that occurs
ABOVE the 89 average.
• Over the years I have noticed that pullbacks that
extend well below the 89 turn too often into reversals.
• The pullback should occur on falling volume.
• That’s what happened in Telkom and its shown in the
next slide.

17. Swing Trading

18. Swing Trading
• The stochastic adds the last dimension to the trade
entry.
• The best entries occur when the stochastic is below 20.
• The best entries occur when the stochastic is showing
reverse divergence with the price.
• That’s shown next and I will explain on the flip chart at
the UG in detail.
• Its visual and a real edge in markets.

19. Swing Trading

20. Swing Trading
• I use the VV stop loss for my swing trades.
• I could get closer to the market action but then the
stop is in the TRAFFIC and its easy to die in a sea of
stops. Calculate the number of shares to buy so as if
the position fails you lose no more than 2% of your
account.
• My entry is confirmed by the first solid green bar at the
level when the stoch is showing reverse divergence.
• A knowledge of candle patterns will be useful here.
There is plenty of free analysis all over the internet.

21. Swing Trading
• The target is vital in short term timing especially if you
are using leverage.
• I split my position into three pieces.
• Exit the first 1/3 when you have made as much as you
have initially risked. This brings the total risk to initial risk
on 1/3 of the position. (2/3 left but you have made 1/3)
• Exit the 2nd 1/3 at the old high and get the stop to entry
at this point.
• Exit the last 1/3 at a 1.618 extension of the last
pullback.

22. Swing Trading
• If the fundamental position of the share is good. If the
technical position of both the share and the general
market are also good then I can predict the future with
an accuracy that is uncommon in this line of work.
• The trades don’t come along as frequently as I would
like but I can have my cake and eat it. I have taken
trades where all the conditions haven't been met and
many have been fine. I will leave that to your own
research.
• The Telkom trade was broadcast last week in a
webcast prior to the move

23. Capitec
Long way to go

24. Omnia
Going well

25. PSG
Technically good
VV says its overvalued

26. Brait

27. Invicta

28. Wescoal
Be calm good things take time

29. Group 5
Just a matter of time

30. woolies

31. Woolies

32. TCP

33. TCP
• Rv = 1.42
• Unvalued with our Value at 7.36
• Rs= 1
• It’s a strong contender for a large move assuming no
systematic risk.