What is the super trend indicator for swing trading? (2024)

What is the super trend indicator for swing trading?

The Supertrend Indicator is a popular technical analysis tool designed to assist traders in identifying market trends. The indicator combines the average true range (ATR) with a multiplier to calculate its value. This value is then added to or subtracted from the asset's closing price to plot the supertrend line.

As per the market experts, the best Supertrend settings for swing trading are usually the 4-hour and 1-day charts that you can use in combination with the default 10,3 Supertrend line.

Like most indicators, Supertrend performs optimally when combined with other indicators like MACD, Parabolic SAR, or RSI. Additionally, the 'Supertrend' serves as robust support or resistance levels while also offering a dynamic trailing stop-loss feature for ongoing trades.

However, it is important to note that no trading strategy is 100% accurate, and the super-trend indicator is no exception. The indicator is limited by its lagging nature, is not very flexible, and can send up false signals. It is often used with other technical indicators for a more comprehensive trading strategy.

However, Super Trend needs to be used in conjunction with other indicators like RSI, Parabolic SAR, MACD, etc to receive filtered signals. Moreover, Supertrend also works as a trailing stop-loss for the existing trades and acts as strong support or resistance.

Supertrend Indicator Default Settings ATR 10, Multiplier 3:

The configuration serves as a balanced starting point, for identifying smaller trends and shifts in market dynamics. With this setup, you'll notice shorter periods of both long and short positions, offering a comprehensive view of market activity.

A. Supertrend 7,3 is a specific configuration of the Supertrend indicator, where the settings are typically a period of 7 for the Average True Range (ATR) and a multiplier of 3.

█ Overview The Dynamic Trailing (Zeiierman) indicator enhances the traditional SuperTrend approach by providing a more nuanced, adaptable tool for trend analysis and market volatility assessment. It combines techniques to identify dynamic support and resistance levels, trend directions, and market volatility.

The Moving Average Convergence Divergence (MACD) indicator is often considered one of the most accurate technical indicators. That is because it uses a combination of moving averages to spot potential buy and sell signals.

Limitations of the Supertrend Indicator

It may generate false signals or erratic results, leading to potential losses for traders who rely solely on it during sideways or ranging market conditions.

What is the formula for super trend?

Here's the formula for calculating the supertrend indicator: #1 – Average True Range (ATR): Calculate the True Range (TR) for each period: True Range (TR) = Max[(High – Low), |High – Close_prev|, |Low – Close_prev|] (where High is the highest price, Low is the lowest price, and Close_prev is the previous closing price)

Of course, the best practice to avoid false signals on short timeframes is by combining the supertrend with additional indicators. For instance, MACD and RSI will allow you to confirm the breakout before committing to a trade.

As far as patterns are concerned, the ascending and descending triangles are considered to be the best. The top swing trading strategies are Fibonacci Retracement, Trend Trading, Reversal Trading, Breakout Strategy and Simple Moving Averages.

There are two types of charts you can use when swing trading: candlestick charts and bar charts. Candlestick charts give you more insights because they show the opening, closing, high, and low prices for a stock. Bar charts only show the closing price.

The standard settings for the SuperTrend are an ATR of 10 and a multiplier of three. The best settings for you depend on your strategy and style – day traders may lower both figures to generate more signals, while longer-term traders may make them higher.

The Dual-Supertrend with MACD strategy offers an amalgamation of two trend-following indicators (Supertrend 1 & 2) with a momentum oscillator (MACD). It aims to provide a cohesive and systematic approach to trading, eliminating the need for discretionary decision-making.

The win rate of the Supertrend indicator is around 67% from our calculation and tests.

The Supertrend Indicator's reliability depends on several factors: market conditions, the asset type, and your investment goals. While the Supertrend Indicator might be valuable for identifying trends and managing risk, its reliability is not absolute and should only be used as part of a comprehensive strategy.

Stochastics are a favored technical indicator because they are easy to understand and have a relatively high degree of accuracy. It falls into the class of technical indicators known as oscillators. The indicator provides buy and sell signals for traders to enter or exit positions based on momentum.

The Supertrend indicator offers support and resistance levels for traders to enter into and exit trades in a profitable manner. Apart from that, it also provides the necessary signals for setting stop losses. You can set the stop loss below the green line if you have gone long.

What to pair supertrend indicator with?

Note: Traders often pair the Supertrend indicator with other Forex-specific indicators like the Moving Average Convergence Divergence (MACD) or Relative Strength Index (RSI) for further confirmation.

Here is the Super trend indicator formula that helps you calculate this indicator: Down = [(High + Low / 2) – Multiplier] x ATR. Up = [(High + Low / 2) + Multiplier] x ATR.

Definition. The Supertrend strategy is based on the Supertrend indicator. It enters long whenever Supertrend changes its position from being above the chart to being below, and enters short when the opposite happens. The underlying Supertrend indicator is described in detail in its respective Help Center article.

Which is one of the most accurate trading indicators? The most accurate for trading is the Relative Strength Index. It is considered one of the best momentum indicators for intraday trading. It helps investors identify the shares which are bought and sold in the market.