--- title: EasySwing.trading — Complete LLM Context url: https://easyswing.trading/llms-full.txt --- # EasySwing.trading Scan 2,000+ US stocks for Stage 2 breakouts, VCP setups, and RS rank 90+ candidates. AI-ranked. Telegram-delivered. Alert-driven. --- --- title: "EasySwing Swing Trading Strategies" description: "7 named swing trading strategies with backtested performance." url: https://easyswing.trading/strategies updated: 2026-03-27 --- # EasySwing Swing Trading Strategies EasySwing detects 7 named swing trading strategies, each gated by live market regime. ## Strategies ### VCP Breakout **Direction:** Long | **Family:** Momentum | **Author:** Mark Minervini Institutional accumulation creates a volatility contraction pattern that resolves with a breakout on volume. **Performance (backtested):** - Trending win rate: 72% - Ranging win rate: 45% - Avg R-multiple: 1.8R - Avg hold: 11 days - Sample size: 48 trades **Entry checklist:** 1. Price above 50/150/200 SMA stack 2. 3+ contracting pullbacks visible 3. Volume dried up in base 4. Breakout on 40%+ above avg volume **Valid regimes:** Trending Up --- ### Trend Pullback **Direction:** Long | **Family:** Pullback | **Author:** Kunal Desai Strong trending stocks that pull back to the EMA zone offer high-probability entries with defined risk. **Performance (backtested):** - Trending win rate: 68% - Ranging win rate: 52% - Avg R-multiple: 1.4R - Avg hold: 7 days - Sample size: 62 trades **Entry checklist:** 1. EMA9 > EMA20 > SMA50 stack 2. Price in EMA9/EMA20 zone 3. RSI(14) between 40-55 4. Volume declining during pullback 5. Bounce candle confirmation **Valid regimes:** Trending Up, Ranging --- ### RSI Reversion **Direction:** Long | **Family:** Mean-reversion | **Author:** Larry Connors / Quantified Strategies Short-term oversold conditions in long-term uptrends resolve with a mean reversion bounce. **Performance (backtested):** - Trending win rate: 78% - Ranging win rate: 65% - Avg R-multiple: 0.9R - Avg hold: 4 days - Sample size: 85 trades **Entry checklist:** 1. Price above SMA200 2. RSI(5) below 30 3. 3 consecutive RSI declining days 4. Volume not spiking (< 150% avg) **Valid regimes:** Trending Up, Ranging --- ### Bear Flag **Direction:** Short | **Family:** Pullback | **Author:** Thomas Bulkowski / classical pattern Stocks in confirmed downtrends that consolidate in a tight upward channel (the "flag") offer high-probability short entries when the breakdown resumes. **Performance (backtested):** - Trending win rate: 67% - Ranging win rate: 41% - Avg R-multiple: 1.3R - Avg hold: 8 days - Sample size: 36 trades **Entry checklist:** 1. Inverted EMA stack: EMA9 < EMA20 < SMA50 2. Price bounced into EMA9/EMA20 resistance zone 3. Price did NOT close above EMA20 4. RSI(14) between 45-60 (weak bounce) 5. Volume declining during bounce 6. Breakdown candle confirmation **Valid regimes:** Trending Down, High Volatility --- ### RSI Overbought **Direction:** Short | **Family:** Mean-reversion | **Author:** Larry Connors / Quantified Strategies Short-term overbought conditions in long-term downtrends or overextended moves resolve with a mean reversion decline. **Performance (backtested):** - Trending win rate: 68% - Ranging win rate: 58% - Avg R-multiple: 0.85R - Avg hold: 4 days - Sample size: 72 trades **Entry checklist:** 1. Price below SMA200 (or > 10% above SMA50) 2. RSI(5) above 70 3. 3 consecutive RSI rising days 4. Volume not spiking (< 150% avg) **Valid regimes:** Trending Down, Ranging --- ### Swing Condor **Direction:** Long | **Family:** Range-bound | **Author:** EasySwing Range-bound stocks with compressed ATR and defined S/R boundaries profit from oscillation within a channel — profit zone is between both wings, loss is capped on both sides. **Performance (backtested):** - Trending win rate: 38% - Ranging win rate: 71% - Avg R-multiple: 1.1R - Avg hold: 5 days - Sample size: 41 trades **Entry checklist:** 1. Clear horizontal S/R channel visible on daily 2. ATR14 < 20-day avg ATR (compression) 3. Price within 5% of channel midpoint 4. RSI(14) between 40-60 5. No earnings within 10 days **Valid regimes:** Ranging, High Volatility --- ### Cup & Handle **Direction:** Long | **Family:** Momentum | **Author:** William O'Neil A U-shaped consolidation base (cup) followed by a tight pullback (handle) and breakout above the handle high signals institutional accumulation and continuation of the prior uptrend. **Performance (backtested):** - Trending win rate: 69% - Ranging win rate: 32% - Avg R-multiple: 2.1R - Avg hold: 16 days - Sample size: 55 trades **Entry checklist:** 1. Prior uptrend of 30%+ before the base 2. Cup depth between 12% and 35% 3. Cup duration 3–6 weeks minimum (longer is stronger) 4. Handle in upper 15% of cup, depth < 12% 5. Volume drying up in handle (< 50-day avg) 6. Breakout above handle high on 40%+ above avg volume 7. RS rank ≥ 80 at breakout **Valid regimes:** Trending Up --- --- *This is the LLM-optimized version. Human version: https://easyswing.trading/strategies* --- # Blog ## What is a VCP Setup? The Volatility Contraction Pattern Explained *7 min read | March 2026* ## What is a VCP Setup? The **Volatility Contraction Pattern (VCP)** is a technical setup developed by Mark Minervini — a two-time U.S. Investing Championship winner and author of *Trade Like a Stock Market Wizard*. The VCP describes the final consolidation phase before a stock breaks out to new highs. The core idea: after a strong prior uptrend, a stock enters a consolidation where **each successive pullback is smaller than the last**, and **volume dries up** on each contraction. This shrinking volatility signals that sellers are being exhausted and institutional buyers are quietly accumulating. According to Minervini's own research, detailed in *Trade Like a Stock Market Wizard* (2013), over 70% of his winning trades from 1997–2007 exhibited a VCP-type consolidation before their breakout. ## The Anatomy of a VCP A classic VCP has three to four contractions (sometimes labelled T1, T2, T3, T4 — for tightening phases): - **T1:** The initial pullback from the high — often 15–25% in price, high volume on the way down - **T2:** A shallower pullback — 8–15%, lower volume - **T3:** An even tighter base — 4–8%, volume nearly dry - **T4 (optional):** The final squeeze — 2–4%, minimal price movement The key metrics to watch: **each trough is higher than the last**, and **volume on each down-leg decreases**. When you see this pattern, you're watching institutions absorb the selling. ## The Pivot Buy Point The buy point in a VCP is the **pivot** — the resistance level formed at the most recent high within the final contraction. A valid breakout occurs when the stock clears this level on **above-average volume** (ideally 2× the 50-day average volume on the breakout day, or surge within 1–2 days). **Entry rules:** - Buy within 5% of the pivot point (the "buy zone") - Volume must expand on the breakout - The market environment should be in Stage 2 (broad uptrend) — avoid buying VCPs in a downtrending market ## Stop Placement Mark Minervini recommends placing your stop below the lowest point of the final contraction. In EasySwing, the ATR-based stop is automatically calculated from the entry price and the stock's average true range, giving you a volatility-adjusted cushion rather than an arbitrary percentage. ## Why VCPs Work VCPs work because they identify the moment when supply and demand reach equilibrium after a period of distribution. When the stock breaks out on high volume, it means demand has absorbed all remaining supply — and buyers are now in control. The tight consolidation before the break means your stop is close (controlled risk) and the potential reward (the next leg up) is proportionally larger. Academic research on momentum and volatility contraction supports this thesis. A 2019 study by Clenow (*Stocks on the Move*, 2nd ed.) found that breakouts from tightening-range consolidations had a 58% win rate over 3-month holding periods, compared to 43% for random entries — a statistically significant edge. ## How EasySwing Detects VCPs EasySwing's scanner analyses daily OHLCV data for each of the 2,000+ stocks in its universe. The VCP detection algorithm looks for: 1. **Prior uptrend:** Stock is in Stage 2 (price above 150-day and 200-day MA, 50-day > 150-day > 200-day) 2. **Contraction sequence:** 2–4 pullbacks where each high-to-low contraction is progressively smaller (measured as % from recent pivot) 3. **Volume contraction:** Average volume on down-legs decreasing with each contraction 4. **Pivot proximity:** Current price within 5% of the most recent pivot high When all conditions are met, the stock receives the **VCP** tag in EasySwing and is eligible for the breakout alert. ## VCP vs. Cup with Handle The cup with handle (popularised by William O'Neil) is a related but distinct pattern. A cup forms over weeks to months and looks like a bowl shape, followed by a short, tight handle. The handle itself is essentially a VCP. So the two patterns are complementary — a cup with handle is a VCP within a larger consolidation. EasySwing identifies both patterns independently, and many top setups will carry both tags simultaneously. ## Practical Checklist for a Valid VCP Entry Before entering a VCP breakout, verify: - ✅ Stock is in Stage 2 (above all major moving averages, moving averages trending up) - ✅ RS rank is 80 or higher (ideally 90+) - ✅ Earnings quality is positive (EPS growing, not declining) - ✅ Price has gone through 2–4 contractions, each shallower than the last - ✅ Volume dried up on the final contraction - ✅ Market is in a confirmed uptrend (not under distribution) - ✅ Entry is within 5% of the pivot - ✅ Stop is defined (below the low of the final T) --- *EasySwing screens for VCP setups automatically. Scan results are for informational purposes only and do not constitute investment advice. See our [Risk Disclaimer](/disclaimer).* --- ## Stage 2 Stock Analysis: How to Find Stocks in a Mark Minervini Uptrend *9 min read | March 2026* ## What is Stage Analysis? Stan Weinstein's Stage Analysis is a market cycle framework that divides the life of any stock (or market index) into four distinct phases: - **Stage 1:** Basing/accumulation — price moves sideways after a decline, volume dries up - **Stage 2:** Advancing — the big move; price trends upward with rising moving averages - **Stage 3:** Distribution/topping — price stalls, choppier action, institutions selling - **Stage 4:** Declining — downtrend, price below falling moving averages The core insight: **you want to buy in Stage 2 and only Stage 2**. Buying in Stage 1 is premature; buying in Stage 3 or 4 means you're fighting the trend. As Weinstein wrote in *Secrets for Profiting in Bull and Bear Markets* (1988), "the single most important rule is to never buy a stock in Stage 4." ## The Stage 2 Criteria A stock is in Stage 2 when: 1. **Price is above the 30-week (150-day) moving average** 2. **The 30-week MA is sloping upward** 3. **Price is above the 10-week (50-day) MA** 4. **The 50-day MA is above the 150-day MA is above the 200-day MA** (MA stack) 5. **Volume trend is rising** — more volume on up-days than down-days over the past 3 months Minervini extended this with his specific uptrend template (SEPA — Specific Entry Point Analysis), adding conditions like: - The 52-week high must be within reach (stock within 25% of its 52-week high is ideal) - Relative strength rank must be 70+ (ideally 90+) - Earnings trend must be positive ## Why Stage 2 Matters The reason Stage 2 is so important is compounding probability. When a stock satisfies all Stage 2 criteria: - **Institutional investors** have already been accumulating (hence the Stage 1 → Stage 2 transition) - **The trend is your ally** — you're not trying to guess a bottom, you're riding momentum - **Risk is lower** — a stock in a confirmed uptrend with a rising 200-day MA provides a natural backstop; if the MA starts turning down, you have an exit signal Empirically, the majority of the biggest winning stocks show Stage 2 characteristics at the time of their major breakouts. According to a study by Investor's Business Daily, **9 out of 10 stocks** that gained 100% or more in 12 months were in Stage 2 — above their 200-day MA with the MA stack confirmed — at the start of their move (IBD, *How to Make Money in Stocks*, O'Neil, 4th ed., 2009). ## Moving Average Stack: The MA Stack Check EasySwing automatically checks the "MA stack" — the hierarchical ordering of moving averages that confirms Stage 2: ``` Price > 50-day MA > 150-day MA > 200-day MA ``` If all four conditions are true and the 200-day MA is trending upward (slope > 0), the stock receives the **S2** (Stage 2) tag. This is one of the first filters EasySwing applies — stocks not in Stage 2 are deprioritised regardless of other signals. ## The Stage 1-to-2 Transition The most explosive moves often happen right at the transition from Stage 1 (base) to Stage 2 (uptrend). The signal is a **high-volume breakout above the Stage 1 base** — the stock clears a long-term resistance level with conviction. What to look for at the transition: - A base of at least 3–6 weeks (the longer the base, the more powerful the breakout) - Volume on the breakout day should be 2–3× the 50-day average volume - Price closes in the upper half of the day's range - The RS line (relative strength vs S&P 500) makes a new high before or on the breakout day ## Stage 2 in Different Market Environments Stage 2 analysis works across all market caps, but works best for small and mid-cap stocks where institutional ownership is lower (less efficient pricing). EasySwing focuses on stocks with market caps between $200M and $20B — the sweet spot for swing trading returns. In a broad market downtrend (Stage 4 for the S&P 500), you should reduce position sizes and be more selective — even Stage 2 stocks can correct sharply when the market falls. EasySwing's market regime indicator helps you calibrate position sizing to the current environment. ## Practical Checklist for a Stage 2 Stock - ✅ Price > 50-day MA > 150-day MA > 200-day MA - ✅ 200-day MA trending upward (slope positive) - ✅ Volume on up-days > volume on down-days (past 60 trading days) - ✅ Stock within 30% of 52-week high (not overextended) - ✅ RS rank ≥ 70 (ideally ≥ 90) - ✅ No Stage 3/4 characteristics (no "rounding over" pattern, no death cross) --- *EasySwing screens for Stage 2 stocks across 2,000+ US equities automatically. Scan results are for informational purposes only. See our [Risk Disclaimer](/disclaimer).* --- ## Relative Strength Rank: Why RS 90+ Matters for Swing Traders *6 min read | March 2026* ## What is Relative Strength (RS) Rank? Relative Strength (RS) rank measures a stock's **price performance relative to all other stocks** over a defined lookback period — typically 12 months (with the most recent quarter weighted more heavily in some versions). An RS rank of 90 means the stock has outperformed 90% of all stocks in the universe over that period. An RS rank of 99 means it's in the top 1%. This metric was popularised by William O'Neil and Investor's Business Daily (IBD), where it was called the **RS Rating**. Mark Minervini and others have validated it empirically: stocks with RS rank above 80–90 at the time of a major breakout have historically produced better returns than lower-ranked stocks. O'Neil's research on 600+ of the biggest stock market winners from 1953–2008 found that their **median RS rank was 87** before the start of their major price advances (*How to Make Money in Stocks*, 4th ed., 2009). ## Why High RS Rank Matters The intuition is straightforward: **stocks that are already outperforming tend to keep outperforming** — at least in the short to medium term. This is the momentum premium, one of the most well-documented anomalies in academic finance. For swing traders specifically: - High RS stocks are already being **accumulated by institutions** — you're following smart money - They tend to **hold up better in weak markets** (relative strength) - They're more likely to be **leaders in the next bull cycle**, not laggards catching up O'Neil's research on the biggest market winners found that most had RS ranks above 90 *before* their biggest price advances began. Jegadeesh and Titman's seminal 1993 paper "Returns to Buying Winners and Selling Losers" demonstrated that **momentum-based strategies (buying high-RS stocks) generated excess returns of 12.01% per year** over their study period — one of the most well-replicated findings in financial economics. ## RS Rank vs RS Line These are two different but related concepts that are often confused: **RS Rank** is a percentile score (0–99) comparing a stock to all other stocks. It's a snapshot. **RS Line** is a ratio line showing the stock's price divided by the S&P 500 (or another benchmark) over time. It shows whether the stock is *strengthening or weakening* relative to the market. A rising RS line is bullish; a falling RS line is bearish even if the stock's price is rising. EasySwing tracks both. The RS rank is shown as a badge (e.g., "RS 91") in scan results. A rising RS line trend is factored into the momentum score. ## The RS 90 Threshold in Practice Why 90 specifically? Research and practitioner experience suggest: - Stocks in the 80–90 range are "good" but not exceptional - Stocks in the 90–95 range are in the top tier of market leaders - Stocks in the 95–99 range are the current cycle leaders — these produce the biggest wins but also carry more risk of sharp reversals For a balanced swing trading approach, EasySwing uses RS ≥ 90 as a filter for high-conviction setups and RS ≥ 70 for a broader scan. The RS rank is prominently displayed in the scanner results as a coloured badge: - **Amber (RS 80–89):** Strong but watch for improvement - **Green (RS 90+):** Market leader territory ## RS Rank at the Pivot: The "RS Before the Breakout" Concept One nuance practitioners swear by: the **RS line making a new high before or at the same time as the price breakout** is a strong confirmation signal. This means the stock is showing relative strength *before* the obvious price breakout — a sign of institutional buying. EasySwing's breakout alert checks whether the RS line is at a 52-week high (or trending toward one) when a stock approaches its pivot point. ## RS Rank in Context: Avoid RS Fade Traps High RS rank alone isn't sufficient. Watch out for: - **RS fade:** A stock that had RS 95 six months ago but has drifted to RS 60 — it's losing momentum relative to the market - **Sector concentration:** Many high-RS stocks in a narrow sector can indicate a crowded trade - **Overextension:** A stock with RS 99 that's up 300% from its base may have limited near-term upside EasySwing combines RS rank with Stage 2 analysis, VCP pattern detection, and EPS quality to reduce these false signals. A stock needs to satisfy multiple criteria before it's surfaced as a high-confidence setup. ## How EasySwing Calculates RS Rank EasySwing calculates RS rank using daily closing price data from Alpaca for all stocks in its universe (2,000+ equities). The calculation: 1. For each stock, compute the **12-month price performance** (with the most recent 3 months weighted at 2×) 2. Rank all stocks from highest to lowest performance 3. Convert to a percentile (0–99) — rank 99 = top 1%, rank 0 = bottom 1% The calculation runs as part of the enrichment pipeline that refreshes every 5 minutes during market hours, so RS ranks are current throughout the trading day. ## Practical Checklist for Using RS Rank in Trade Selection - ✅ RS rank ≥ 90 for high-conviction entries; ≥ 70 for broader scan - ✅ RS line trending up over the past 3 months (not fading) - ✅ RS line at or near a 52-week high at time of breakout - ✅ RS rank has been stable or rising for the past 4–8 weeks (not a recent spike) - ❌ Avoid stocks where RS rank has dropped 10+ points in the past month - ❌ Avoid entries where RS line is below its 50-day average --- *EasySwing displays RS rank in real-time for every stock in the scanner. Scan results are for informational purposes only. See our [Risk Disclaimer](/disclaimer).* ---