Swing high

A turning point, defined by a rule with a parameter in it. The rule compares one bar's high against the highs of a chosen number of bars to its left and the same number to its right, and where it stands above both sets, that bar is a swing high. The parameter is a choice: a wider setting produces fewer and more significant peaks, a narrower one produces many. Some tools apply the same rule to closing prices instead, which gives a different set of peaks on the same chart.

Swing points are the raw material for most structural chart reading. A sequence of higher swing highs alongside higher swing lows is what a description of an uptrend actually consists of, trend lines and channels are drawn between them, retracement and extension measurements are anchored to them, and named chart patterns are described by the arrangement of the peaks and troughs they contain.

The confirmation lag is the trip, and it is structural rather than a flaw in any particular tool. A bar cannot be known to be a swing high until the required number of bars to its right have printed without exceeding it, so the most recent apparent peak on any chart is provisional and can be superseded. This is precisely why automated pivot indicators appear to redraw themselves. A swing high also exists only relative to the time frame it was found on: a clear peak on an hourly chart is frequently not visible at all on a daily one.