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Seven concepts that unlock everything the screener does. Plain English, no jargon you can't infer.
If you already know what VCP, Stage 2, and R-multiples are, skip to the live setup →
- 01 · the unit
Setup
A "setup" is a chart pattern with a defined entry, stop, and target — three numbers you write down before you trade, not after. Every setup has a thesis ("this base looks ready to break") and a falsification line ("if it closes below the stop, the thesis was wrong").
EasySwing scans 2,000+ US stocks every trading day, finds the setups, and grades each one A through D. Your job is to pick from the A and B+ list — not to hunt the whole market by hand.
- 02 · the chart cycle
Stage (Weinstein's 4-stage model)
Every stock cycles through four stages: Stage 1 sideways basing (institutions accumulate quietly) → Stage 2 confirmed uptrend (the slope where price clears its 30-week moving average on volume) → Stage 3 topping → Stage 4decline.
EasySwing only fires long signals on Stage 2 stocks. That's the slope where the edge is most durable — the rest of the cycle either hasn't started (Stage 1) or is fighting gravity (Stage 3/4).
// source: Stan Weinstein, Secrets for Profiting in Bull and Bear Markets (1988)
- 03 · the leader filter
RS Rank (not RSI)
"Relative Strength rank" measures a stock's 12-week return versus every other stock in the US universe. RS 90 means top 10%. RS 99 is the top 1%.
This is not the RSI indicator. Same prefix, different concept. RSI is an oscillator between 0-100 measuring short-term momentum on a single stock. RS rank is a percentile comparing one stock to thousands of others. EasySwing requires RS ≥ 80 for most setups — leaders lead, laggards lag.
// source: Mark Minervini, Trade Like a Stock Market Wizard (2013) — popularised the rank-vs-RSI split
- 04 · the contraction pattern
VCP — Volatility Contraction Pattern
A 4–8 week base where price ranges get progressively tighter and volume dries up. Usually three contractions deep, each one narrower than the last. The tightness signals that sellers have exhausted themselves.
A breakout on volume confirms institutional buying returned. Without the volume confirmation it's a candidate, not a trade — EasySwing's grader penalises low-volume breakouts hard.
// source: Mark Minervini, Trade Like a Stock Market Wizard (2013)
- 05 · the classic base
Cup & Handle
A rounded "U"-shaped base (the cup) that takes weeks to months to form, followed by a smaller, tighter pullback near the rim (the handle). A breakout above the handle's high is the entry.
The cup is institutional digestion of a prior run. The handle is the last shake-out before the next leg — late sellers leaving, patient buyers stepping in. Don't confuse a cup with any rounded chart bottom; the depth, duration, and prior trend all matter.
// source: William O'Neil, How to Make Money in Stocks (1988)
- 06 · the trader's unit
R-multiple
Every trade has a planned risk — the "R". A win that closes at 2× your planned risk is +2R. A loss at the stop is -1R. Win rate alone doesn't tell you whether you have an edge.
A trader who wins 40% of the time with average wins of +2R and average losses of -1R still profits: expectancy = (0.4 × 2) + (0.6 × -1) = +0.2R per trade. The journal shows every closed trade in R-multiples so the math is honest — dollar P&L hides the asymmetric pattern that separates a system from luck.
// source: Van Tharp, Trade Your Way to Financial Freedom (1998) — popularised R-multiple thinking
- 07 · the volatility ruler
ATR — Average True Range
How much a stock typically moves in a single day, in price units. A $200 stock with ATR=$4 normally swings $4 from open to close. A $20 stock with the same 2% volatility has ATR=$0.40.
EasySwing sizes stops by ATR — "stop at 2× ATR below entry" adapts to each stock's natural range. A fixed % stop punishes volatile stocks (too tight, stopped out by noise) and pampers quiet ones (too wide, the loss costs more than your risk budget). The default 2× ATR stop is a starting point; the onboarding wizard lets you set yours between 1× and 4×.
// source: J. Welles Wilder, New Concepts in Technical Trading Systems (1978)
Ready to see them in action?
EasySwing runs every concept above against 2,000+ US stocks every morning, grades each setup, and posts the shortlist before the open.