This week’s Calypso release (Dec 1st) contains three new indicators based on David Vassallo’s system of swing trading. One is a Plotted Script called Vassallo Swing, and there are two Entry Scripts called Vassallo Butterfly and Vassallo Three Swing. The Vassallo Swing Plotted Script displays a series of trend lines on a price chart covering the swings in a price from highs to lows. It uses basic reversal rules detailed below.
A swing with a period of 10 that starts at a peak ends once a point has been reached that has a Lower Low than the Lows of the ten points prior to it (not counting “Inside Days” – days with a Lower High and a Higher Low than the day before them). A swing with a period of 10 that starts at a trough ends once a point has been reached that has a Higher High than the Highs of the ten points prior to it (again not counting “Inside Days”). When determining if a point is a Lower Low or Higher High than previous points, the Vassallo Swing makes allowance for a “Stretch %”: a percentage by which the new extreme must exceed the previous points to be considered as ending the previous swing.
The Vassallo Swing chart tends to eliminate noise and simply show the main underlying trends in the price data. David Vassallo teaches in his seminars methods to look for buy and sell signals based on the shapes of these swings. It’s an approach he has used profitably for many years, and one which he has taught to many traders through the seminars. Those swing chart previously had to be drawn laboriously but now the Vassallo Swing script draws the swings for you.
The two boolean Entry Scripts look for particular shapes that come up in the system. The most basic is a Vassallo Three Swing. This pattern is just an up swing, followed by a shorter down swing, followed by a longer up swing; or the reverse of this sequence. The Vassallo Butterfly script looks for a more complicated (and rarer) pattern, which is pictured and described in detail on its Help page (see links below).
For those who already use David’s system, these scripts should save you a lot of time. For those who are interested in the system and would like to know more, go to:
There are Help pages written for each of the three new scripts. They are at:
Vassallo Swing plotted script
Vassallo Butterfly entry script
Vassallo Three Swing entry script
These indicators should be available with the next upgrades to the Market Analyser.