Swing Trading and Momentum Trading have become the highest arts for professional speculators trading stock markets and liquid futures markets in the last two decades largely due to explosive growth of the Internet and online trading infrastructure. Recent years have also seen a flourishing publication of professional literature books, articles and courses on swing trading and momentum trading [Crable 1990; Connors and Raschke 1995; Williams 2000; Farley 2000; McDonald 2002; Pring 2002; Crane 2003].
It is obvious that while being useful to provide empirical knowledge and wisdom, the professional literature is not intended to, and does not, provide the kind of qualities, mainly the falsifiability, repeatability, reliability, rigor and computability, required by modern mathematical and experimental sciences. However, a small minority of swing and momentum traders have indeed attained high levels of proficiency and become consistent winners profiting from multilevel swings and abrupt momentum moves of market prices.
This has raised a great challenge to the science community of theoretical finance to develop a scientific theory for understanding the market swing and momentum behavior and underlying structures and mechanisms, and also to the engineering community of computational finance to develop computational intelligent systems for predicting market swings and momentums and for capturing pockets of profitable market opportunities with risks under check and control.