Mikula Forecasting Company

MarketWarrior: Swing Projector Type #2 Buy Signal

Here we will discuss the Type #2 Buy Signal for the Swing Projector. Below are two charts for the Dow Industrial Average using eSignal symbol $INDU. This buy signal uses two indicators: the MarketWarrior Swing Projector and the Bollinger Plus.

The Type #2 Buy Signal has four parts. First, a sideways movement in the price action must occur. On the first chart below, I have drawn a box around this sideways price action and labeled it, "Sideways Movement".

Second, the Swing Projector, "Warning Pivot Symbol" must occur. The Swing Projector warning symbol indicates the conditions for a bottom have been met, and you should start watching for a bottom pivot. This warning symbol is the red upward triangle with the letter "B" inside.

The third part of this buy signal occurs when the price action moves below the bottom line in the Bollinger Plus.

The fourth and final part of this buy signal occurs when the price rallies back above the Bollinger Plus bottom line. When these four events occur, the Swing Projector Type #2 Buy Signal has occurred and you should look for the best opportunity to buy long.




The next chart shows what happened after the Type #2 Buy Signal was given. It took a few bars to show that the price had turned up but then the price continued to move up through the end of the day. The goal of this buy signal is to find swings that are large enough for a swing traders to trade profitably. You can see that after this Type #2 Buy Signal there was plenty of opportunity to enter a long position.