Swing Trading Strategies: Comparing Screening Approaches

A swing trading strategy is a set of rules for which stocks to trade, at what price to act, where the trade is wrong, how much to risk and when to leave. A stock screen applies only the first of those rules. This guide compares four approaches swing traders commonly use, through the part a screen can apply: what each one measures, the chart it tends to produce, which of QM Screener's screens applies it and what that screen does not supply.

The measurements behind these approaches

Three measurements recur across these approaches, each defined here the way QM Screener computes it.

Relative strength (RS) is a stock's three-month return, ranked as a percentile within the set that screen scores. For Trend Template that set is only the names with about a year of history, and for VCP only the names past its liquidity floor. An RS of 90 means the stock's three-month return beat that of 90 percent of the set.
ADR%, the average daily range, is the mean of each session's high divided by its low over the last 20 sessions, minus one, expressed as a percent. It measures how far a stock typically moves in a day.
Dollar volume is the closing price times the shares traded, which approximates the value that changed hands in a session. It measures liquidity. The screens here that test it average it over the last 50 sessions, and Momentum Continuation also checks the last 20.

Not every screen gates on all three. Momentum Continuation and Momentum Pullback gate on all three. Trend Template gates on RS only. VCP gates on the 50-session dollar volume and shows RS for context.

QM Screener runs seven screens: six published methods and one pullback cut. The four approaches below map onto four of those screens. The fourth, Momentum Pullback, is a narrowing of Momentum Continuation and not a separate strategy. The other screens are not compared here. Gappers and Swing Momentum are covered in how to screen for momentum stocks; Defensive Strength has a guide of its own. The screen named Swing Momentum is a separate screen with an ADR% band of its own, not one of the four approaches here.

Momentum continuation

What is measured. Strength already in the price: where the stock's three-month return ranks against the market, plus floors on liquidity and volatility and a close above the 50-day average.
The chart. A stock in an established advance, above its 50-day average. Some names on the list are far above it after a fast run. Others are moving sideways while their averages catch up.
The relevant screen. Momentum Continuation. It keeps US stocks with an RS percentile strictly above 85, an ADR% strictly above 2.50%, an average dollar volume strictly above $20 million over 50 sessions and $10 million over 20, and a close more than 0.01% above the 50-day simple moving average. It leaves out pharmaceuticals and biotechnology by default.
What it does not supply. No entry price, no exit, no position size and no timing. Rank says how far a stock has come over three months, not where it sits on its chart now. The setup tags describe that position on every row.

Trend confirmation (the trend template)

What is measured. Whether a long-term uptrend is already in place, through an eight-point checklist of moving averages, the 52-week range and relative strength.
The chart. Price above its 150-day and 200-day averages, with the 200-day rising, the 50-day above the 150-day and the 150-day above the 200-day, and price not far below its 52-week high.
The relevant screen. Trend Template. Among its eight points, price must be within 25% of its 52-week high and at least 30% above its 52-week low, the 200-day average must be higher than it was 22 sessions (about a month) earlier, and the RS percentile must be 70 or better. The trend template checklist gives all eight points.
What it does not supply. It confirms a trend that is already established, so by construction it does not show a turn or a bottom. It gives no entry, exit, size or timing.

Volatility contraction (VCP)

What is measured. Whether a stock's range is narrowing in steps while its volume dries up.
The chart. The classic pattern is a base in which each pullback is shallower than the one before, ending in a few tight sessions on light volume, above the 50-day average. The screen does not measure the pullbacks one by one. It compares nested windows: the last 30, 15 and 5 sessions.
The relevant screen. VCP. The 30-session range must be at least 1.5 times the 15-session range, and the 15-session range at least 1.5 times the 5-session range. The final 5-session range must be 8% of price or less, and average volume over the last 5 sessions no more than 0.7 times that of the 25 before them. Price must be above the 50-day simple moving average, with an average dollar volume of at least $5 million over 50 sessions. The list is sorted tightest first. The VCP guide covers each rule.
What it does not supply. It is a heuristic over ranges and volume. It does not draw or confirm a pattern by eye, and it gives no pivot price, entry, exit, size or timing.

Momentum pullbacks

What is measured. A strong stock that made a recent run and has come back to its short moving averages.
The chart. A push well above the 50-day average in the last few weeks, then a pause or a dip to the 20-day exponential moving average (EMA), or into the band the 10, 20 and 50-day EMAs make.
The relevant screen. Momentum Pullback, a narrowing of Momentum Continuation. Every name passes all of the Momentum Continuation rules first, unchanged. It must then have closed at least 15% above its 50-day simple moving average at some point in the last 20 sessions, today included. Today's close must also be within one ADR% of the 20-day EMA, above or below, or inside the EMA band. The cut was chosen by a backtest on past data. The Momentum Pullback guide gives the rule in full and what that backtest did and did not show.
What it does not supply. A pullback to an average says where price sits. It does not say whether the dip ends there, and it gives no entry, exit, size or timing.

The four approaches side by side

Approach	What it measures	Relevant screen	What the chart tends to show
Momentum continuation	Three-month relative strength, with liquidity and volatility floors	Momentum Continuation	An advance holding above its 50-day average
Trend confirmation	Moving averages stacked in order, position in the 52-week range and relative strength	Trend Template	Price above its 150-day and 200-day averages, not far below its 52-week high
Volatility contraction	Nested ranges that narrow and volume that dries up	VCP	A base that tightens into a few quiet sessions above the 50-day average
Momentum pullbacks	A recent run, then a return to the short averages	Momentum Pullback	A strong name sitting back at its 20-day EMA or inside the EMA band

The table compares what each screen measures. It does not rank the approaches, and the chart descriptions are tendencies across a list, not a description of every name on it.

A screen is one part of researching a method

A complete trading method answers more questions than a screen does. A screen answers the first one, which stocks, and it answers it the same way every day. The same rules over the same bars produce the same list, and every row carries its measured values.

The rest is the trader's own work. That includes reading the charts, choosing the levels that matter, deciding how much to risk and when a trade is over. None of the four approaches is recommended here. Each one measures something different, and which one suits a trader depends on their own method, horizon and tolerance for risk. What is swing trading? covers the horizon and the charts these approaches share.

All seven screens run on QM Screener once per US trading day, after the close. A free account shows the top 5 names of each one with their charts, and needs no card.

Frequently asked questions

Which swing trading strategy is best?

This guide does not rank them. It compares what each approach measures and the chart it tends to produce. Which one suits a trader depends on their own method, horizon and risk, which no screen can know.

What is a momentum pullback?

A stock that made a strong run and has since come back toward its short moving averages. The Momentum Pullback screen keeps the Momentum Continuation names that closed at least 15% above their 50-day average in the last 20 sessions and now sit within one average daily range of the 20-day EMA, or inside the 10, 20 and 50-day EMA band.

What is a volatility contraction pattern?

A base in which each pullback is smaller than the one before, so the range narrows in steps, often with volume falling as it does. The VCP screen measures it with three nested ranges (the last 30, 15 and 5 sessions), a cap on the final range and a volume dry-up ratio.

Does a screen give entry and exit points?

No. A screen lists the stocks that passed its rules at the last close and the values that admitted them. Entry, exit, position size and timing are decisions it does not make.

Is Momentum Pullback a separate strategy from Momentum Continuation?

It is a narrowing of it. Every Momentum Pullback name has passed every Momentum Continuation rule first, unchanged, and then one more test about where price sits against its short averages.