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Pressure Cooker -Swing Trading Strategy | Rules and Screener Included | FabTrader
Mar 23, 2025
📈 The 'Pressure Cooker' Swing Trading Strategy – Catch Big Breakout Moves! 🔥
I reveal my 'Pressure Cooker' Swing Trading Strategy, a powerful technique that spots stocks on the verge of explosive breakouts by identifying consolidation patterns with moving averages.
Link to the blog article and free python screener:
https://fabtrader.in/pressure-cooker-high-success-rate-swing-strategy/
#SwingTrading #BreakoutTrading #StockMarket #TradingStrategy #AlgoTrading #PriceAction #StockBreakout #PythonTrading #Nifty200 #TechnicalAnalysis #DayTrading #IntradayTrading #MovingAverages #ChartPatterns #PriceSqueeze #FinancialFreedom
Watch the full playlist of all Trading Strategies:
https://www.youtube.com/playlist?list=PLrlkL2FbEO3HnoVvYbou-vLzvXyb_CFVI
🔍 What You’ll Learn:
✅ How to identify consolidation zones using moving average squeeze (5, 20, 50, 100, 200 MA)
✅ How to use a Chartink screener to filter high-potential stocks in Nifty 200
✅ Two ways to use this strategy – manual watchlist trading & full automation with Python
✅ Entry, stop-loss, and exit strategy to maximize profits & minimize risk
✅ A proven swing trading strategy for cash market traders!
💡 Why This Strategy Works:
✔️ Consolidation leads to breakout – low-risk, high-reward trade setups
Show More Show Less View Video Transcript
0:00
Swing trading is all about capturing
0:01
short to medium-term price movements in
0:03
quality stocks. In this video, I'm going
0:05
to be sharing with you one of my
0:06
favorite strategies, but is not only
0:08
simple to understand and implement, but
0:09
also has a very high success rate, at
0:11
least based on my own personal
0:13
experience. Hello everyone, welcome to
0:15
Factor. In this video, it has three
0:17
parts. First, I'll cover the strategy
0:18
itself, its rules, and risk management
0:20
principles. Secondly, I'll introduce you
0:22
to a free Python screener that that I
0:24
have built that you could use. And
0:26
lastly, I'll share with you the actual
0:27
performance of the strategy in one of my
0:29
own trading accounts. Let's get
0:32
started. If this is your first time
0:34
here, welcome. My name is Vive and I'm a
0:36
financially independent algo trader.
0:37
This channel is all about building a
0:38
community of algo traders. We discuss
0:40
everything about a trading using Python,
0:41
building and practicing trading
0:42
strategies, market updates, and much
0:43
more. Please do visit our community
0:45
website fabtrader.in. Also, do check out
0:47
my other YouTube channel Fab Wealth
0:48
where I talk about my own financial
0:50
independence journey and share tools,
0:51
methods, and strategies that help me
0:53
achieve my financial freedom. Thank you.
0:56
The details that I'm about to share you
0:57
is already fully covered in this blog
0:58
article on our community website
1:00
fabtrader.in. Uh this not only contains
1:02
the the rules of the the strategy, how
1:04
the core logic on how it works, what is
1:06
the screening mechanism that is already
1:08
built in, you have the free Python code
1:09
that you could use to screen uh suitable
1:11
stocks and also tells you how to trade
1:13
those including the risk management
1:15
principles of it. Let us now jump into
1:17
the actual strategy and look at the
1:19
details. This is a breakout strategy and
1:22
it's also a swing strategy. The time
1:24
frame that we would be following is
1:25
daily candles. The trade direction, you
1:27
could only take long trades in this, no
1:28
short ones. And then in terms of the
1:30
indicators used, you would need a 5,20,
1:32
50, 100, and 200 day moving averages.
1:35
Um, in terms of which segment you want
1:36
to trade in, cash segment and then the
1:38
nifty universe that I personally use is
1:40
a nifty 200. You could also consider
1:42
Nifty 500, but you'll have to be really
1:43
careful about the liquidity. So, ensure
1:45
only stocks that have high volume. um
1:48
the screener that I'm about to provide
1:49
you um you could run typically at the
1:51
end of the day after the market is
1:52
closed and then it'll give you a list of
1:54
stocks that are eligible and then based
1:56
on that output um you could take the top
1:58
one or the two based on the highest
2:00
volume within it uh depending upon how
2:02
many stocks you would like to trade each
2:04
day. Uh the next day you could you could
2:06
either put this on your watch list and
2:07
manually monitor it and then get into a
2:09
trade when the consolidation level
2:11
breaks out or you could also place a GTT
2:13
and leave it there uh to be
2:14
automatically traded. The logic of the
2:16
strategy is pretty straightforward.
2:17
That's what makes it one of the most
2:18
simplest and efficient one. You're
2:20
considering 520, 50, 100, and 200 moving
2:23
averages. In this case, as you know,
2:25
this basically represents the broad
2:26
spectrum of the price movement trend,
2:27
starting from the very short-term all
2:28
the way up to the the long
2:31
term. Whenever you see these five EMAs
2:33
of a stock all coming together into a
2:35
very tight range, often within 3% of the
2:38
current market price. Um for example, if
2:40
the market price is 100, then all of
2:42
these five EMAs would stay within the
2:43
range of between 103 and 97. This means
2:46
that the stock is undergoing a tight
2:49
consolidation. This tight consolidation
2:51
is usually followed by a breakout and
2:54
then a rally on the upside. And this is
2:56
exactly what we are looking for. If this
2:58
all sounds a bit confusing, don't worry.
3:00
Uh I'll explain over a chart and then
3:02
I'll give you a real example as well. uh
3:04
in terms of the rules of the long trade
3:06
the entry conditions are that you run
3:08
the daily screener at the end of the day
3:10
after the market hours you can do that
3:12
in two ways one is you could run the
3:14
charting screener uh which I'll provide
3:16
the link to or you could run run the
3:17
python screener which is again nothing
3:19
but it extracts the charting screener
3:21
results the screener would typically
3:23
give you a long list of uh stocks that
3:25
are currently consolidating you don't
3:27
have to consider all of those depending
3:28
upon how many of those you want to trade
3:30
per day either one or two you can
3:32
consider one or two out of the list
3:34
usually by sorting that list by
3:36
descending so that you have the the
3:37
stocks that are that have the maximum
3:39
volume of trade. Right? So that's always
3:41
safer. You you pick up the stocks where
3:43
there is maximum volume of trading
3:44
happening and then you mark the high of
3:46
the consolidation zone and then you wait
3:48
for the price to break out of the zone
3:50
and then you either manually monitor it
3:51
and trade it or you can put in GT orders
3:53
so that the automatic entry is enabled.
3:57
In terms of risk management position
3:58
sizing, the way I'm currently doing it
3:59
is I I limit my position size to either
4:01
10,000 or 15,000 max. I do not exceed
4:04
that limit per order. The exit condition
4:06
is quite simple. There are two ways of
4:07
doing it. One is you can have a set
4:10
target percentage which in this case is
4:11
5%. Uh or if you're somebody don't mind
4:14
sitting on a trade for a longer time and
4:15
want to ride out the the trend, then you
4:17
can start you can keep trailing it. The
4:19
only difference is the in the the first
4:20
case uh people who want to churn their
4:22
trades quicker and then move on to the
4:24
next trade don't want to sit on a trade
4:25
for months. uh they prefer as a target
4:27
like 5%. People who don't mind basically
4:29
their money in the market for a longer
4:31
time and they can ride it out for a
4:32
month or two or more, they tend to
4:34
typically trade it. So depending upon
4:36
your risk appetite, you could use one of
4:38
those uh methods. For stop- loss, I
4:40
usually don't keep any stop- loss. U
4:42
given this is trend following and I've
4:44
picked up only good quality stocks from
4:46
uh stock universe like say Nifty 100 or
4:47
200 with good liquidity. Uh I don't
4:49
worry too much about that stock. Uh no
4:50
striving. So that's why I personally
4:52
don't keep stop loss but it again it
4:53
depends on your uh risk appetite.
4:56
If you haven't joined our telegram
4:57
group, please do so. I share market
4:58
insights, algo trading tips and new
5:00
video notifications. And this way you
5:01
can stay up to date with our community
5:02
news and
5:04
events. I talked about providing two
5:06
types of screeners for it. This is the
5:07
first one which is a charting screener.
5:09
The logic that we already discussed is
5:11
already coded in the link to this
5:12
particular screener. I'll provide it uh
5:14
within the blog
5:15
article. At the end of the day, you can
5:17
do a run scan and then you will get the
5:18
the list of stocks that are currently
5:20
consolidated. Always do remember to sort
5:22
this based on volume. So that way you
5:23
pick up the stocks that has the most
5:24
volume. Here the Python utility in
5:27
question is going to directly scrape
5:28
this particular screen and then download
5:30
the output from this screen into a data
5:32
frame. And this is the Python utility
5:33
that I'm talking about. You would need
5:35
to install these dependencies which are
5:36
request spanders and beautiful soup 4.
5:39
And the utility takes two primarily two
5:41
inputs. One is the the URL of the the
5:44
screen which is which is this typically.
5:47
And then the number two is the scan
5:48
clause. To find out the scan clause for
5:50
your respective screens, all you need to
5:52
do is just right click on your web page,
5:53
go into
5:54
inspect, then go into
5:56
network and then try running scan. You
5:59
would see a process, one of these
6:00
processes comes up and then click on it
6:02
and then go into payload and the scan
6:04
class is right at the top. So all you
6:06
need to do is just copy this
6:08
part and then input that as part of your
6:13
input into the function
6:15
here. So as I said, it takes two inputs.
6:17
minus the the URL that we looked at and
6:19
then the scan class and then once you
6:21
provide this and then
6:23
run you would get the exact same results
6:26
as you see on the scanner
6:28
itself and this is in a data frame. So
6:31
now you can go ahead and use this
6:32
directly in your algo and then apply
6:34
various strategy rules on top of it. So
6:36
this is how simple it is description.
6:37
Now that you know how the utility works,
6:38
let me just give you an example of how I
6:40
use it for my strategies. In fact, I use
6:42
charting screen for multiple strategies
6:43
of mine. Here's one example of how I do
6:45
it. For example, in the scan that we
6:46
just ran, HDFC came up as one of those
6:49
eligible stocks. So, you see there is a
6:50
a tightening of all the SMAs happening
6:52
here, the SMAs are all squeezed up in a
6:54
very tight spot within the 3% uh range
6:56
of the the last closing price. And then
6:58
whenever this happens, for example, in
7:00
the previous time this happened, you see
7:01
this huge breakout rally happening. And
7:03
this is what we are actually looking
7:04
for. And this is my Algo dashboard that
7:06
I had built as part of my Algo trading
7:08
platform. And Pravi, I've been running
7:09
this on one of my smaller accounts. And
7:12
uh the brown part is the the equity
7:14
curve of the strategy and the white part
7:16
is the nifty50. So you see the the
7:18
equity curve looks pretty good. The draw
7:20
down the underwater plot is also like
7:21
less than 3%. This is actually 0%
7:23
because this particular strategy does
7:24
not have a stop- loss. I had uh made a
7:26
couple of mistakes due to which I had to
7:28
close two of the trades because of which
7:29
you see this otherwise you don't close
7:31
any trades. You just keep it open until
7:32
your targets are hit. And even if you
7:34
look at the benchmark versus strategy um
7:37
there's almost a three multiplier
7:38
difference. It the strategy beats the
7:40
benchmark. So, it's a very simple
7:41
strategy and yet at at the same time
7:42
very effective. Hope you like this
7:44
strategy. If you'd like to see more
7:46
content like this, please do like this
7:47
video and that'll motivate me to keep
7:49
doing this. If you'd also like to share
7:50
some of your strategies with the
7:52
community or you would like me to back
7:53
test any of your strategies, please do
7:54
email me with the details and I'll do my
7:56
best. Thank you. If you genuinely found
7:58
this video useful, please consider
7:59
subscribing and liking the video and I
8:01
will see you soon in another video. And
8:02
until then, take care and happy trading.