In this video, I am going to be sharing a simple swing trading strategy that you can use to trade in the stock markets.

So the strategy revolves around a simple price action principle. The principle states that in a weak trend, the pullbacks are deep, and in a strong trend, the pullbacks are shallow.

So, we will use this principle to formulate our strategy. Since this strategy is a swing trading strategy, we will only use it on the daily timeframe.

We will use 3 indicators in our strategy.

Number 1. a 200 period moving average.

Number 2. the ADX indicator.

And Number 3. The stochastics indicator.

So now, lets understand how will we use each of these indicators.

First, lets talk about the 200 period moving average.

So, we will use a 200 period exponential moving average for the trend direction.

The 200 EMA is used by a lot of traders and hence it servers a self fulfilling prophecy.

When the price is above the 200 period moving average, and the 200 EMA is sloped upwards, it is regarded as an uptrend. So we will only look for buying opportunities in an uptrend.

Similarly, when the price is trading below the 200 EMA and the EMA is sloped downwards, it is regarded as a downtrend.

In a downtrend, we will look for selling opportunities only.

In a sideways market, we see that the EMA stays flat and the price keeps on revolving around it. We will avoid trading in such markets.