Qullamaggie Swing Trading Rules: Setups, Stops and Exits

Qullamaggie-style swing trading means buying strong stocks as they break out of a tight consolidation after a big move, with a close stop at the low of the day, selling part of the position after 3–5 days and holding the rest while it closes above the 10- or 20-day moving average. Profits come from a few large winners, not from a high win rate. Below are his public rules, our own backtest of them, and an honest list of what Signae implements and what it doesn't.

Who Qullamaggie is

Kristjan Kullamägi, known as Qullamaggie, is a Swedish trader who explains his method in public: on qullamaggie.com, in live streams and in interviews. He says trading has made him tens of millions of dollars; we can't verify that, so we rely only on the rules themselves. The main source is his article on his three setups at qullamaggie.com. The rest comes from notes on his streams and interviews written by other people. Where sources disagree, we say so.

The three setups

Breakout

1. A strong prior move: up 30–100% or more within the last 1–3 months.
2. Consolidation: usually 2 weeks to 2 months, with higher lows and a tightening range, the stock "surfing" its rising 10- and 20-day moving averages.
3. Trigger: range expansion, the break out of the consolidation.

He buys the breakout itself rather than trying to anticipate it.

Episodic pivot (EP)

• A gap of 10% or more on unexpected news, most often strong earnings.
• Heavy volume: the best ones trade a full day's average volume in the first 15–30 minutes.
• Ideally the stock hasn't rallied much over the prior 3–6 months, so the market had been ignoring it.

Parabolic short

Shorting a stock that has gone up hundreds of percent in days or weeks. It's a separate, riskier technique; we don't implement it and won't cover it here.

Entry, stop and selling, rule by rule

A few details that often get lost in summaries:

• The tight stop is the engine of the method. A stop at the low of the day is usually much closer than one below the whole consolidation, so the same price move is worth more R (multiples of the risk).
• Skip the trade if the stop is too far. If the day's low is more than about one ADR from the entry, no trade.
• Before earnings, according to notes on his streams, he sells unless he has a profit cushion.
• The win rate is low. By his own account and the notes, roughly 25–35%. The money is made by a few trades that return many times the risk.

Worked example: position size and expectancy in R

Size. A $20,000 account, risking 0.5% per trade = $100. Entry at $50, low of the day $47.50: $2.50 of risk per share. Position = 100 / 2.50 = 40 shares, or $2,000, which is 10% of the account. If the stop is hit you lose about $100. That's 1R.

Expectancy (hypothetical numbers). Ten trades at 1R = $100. Three winners averaging +3R (+$900), seven losers averaging −0.9R (−$630; some closed at break-even after the partial sale). Net +$270, or +0.27R per trade, with a 30% win rate.

Note that if the average winner were +2R instead of +3R, the result would be −0.03R. The method lives or dies on letting winners run. Why a win rate means nothing without the size of wins is covered in our article on whether chart patterns work in a backtest.

What our backtest showed

We tested these rules on historical data before showing anything to users. The method:

• 192 liquid US stocks (Yahoo, split-adjusted) and 50 cryptocurrencies (Bybit spot);
• intraday entry at the first hour's high (history only has hourly bars; live signals use 1- and 5-minute bars);
• the first 60% of the history is the tuning period, the rest the check period; a setup is released only if its check-period expectancy is above zero with at least 30 trades;
• no fees or slippage.

Stock results for 22 Nov 2023 to 20 Oct 2026 (check period after 21 Aug 2025):

On crypto, no setup passed: breakout −0.93R on 5 trades, pullback −0.38R on 16 trades.

One telling detail: the same pullback with our earlier daily entry and a stop below the pullback low made +0.17R over the same check period on 53 trades. The intraday entry with a stop at the day's low lifted expectancy to +0.53R, which is exactly the point Qullamaggie makes.

These numbers are modest and come with caveats: the stock list is today's (survivorship bias), fees aren't deducted (with a stop about 1 ADR away, a 0.2% round trip costs roughly 0.03–0.05R per trade), and the longest losing streak in the tuning period was 19 trades in a row. You need to be able to sit through that.

What Signae implements

• Setup: a pullback in an uptrend. The price was well above its 10-day average, came back to the 10- or 20-day average and turned up, with the 50-day average rising. It isn't one of his three signature setups, but it rests on the same idea of riding the moving averages. Breakout and episodic pivot exist in the code but are not shown to users.
• Which stocks: only those in your portfolio or watchlist, with an average daily range of at least 4% and at least $20M traded per day. There's no market-wide scanner.
• Entry: within 5 days of the setup, intraday: the first 1-minute bar's high if the stock opens above the entry level, otherwise the first 5-minute bar's high, and after the first hour the first hour's high.
• Stop: the day's low at entry; if it's more than one ADR away, the signal is marked as missed.
• Market: while the Nasdaq is in a downtrend (close below its 20-day average and the 10-day below the 20-day), the entry waits.
• Exit: a third is sold at the close of day 3 and the stop moves to the entry; the rest on a close below the 20-day average or after 60 days; before earnings the position is closed if it's less than 1R in profit.
• Statistics on the signal: number of historical trades, win rate, average win and loss in R, expectancy, average holding time and longest losing streak. Recalculated every 12 hours.
• Position size: a hint for how much to buy so that the stop costs a chosen share of the portfolio (0.25% to 5%), capped by your available cash.

What's not there: a scan of the market's top 1–2% momentum stocks, parabolic shorts, crypto setups and automatic orders. The app never buys anything for you.

Checklist before a swing trade

1. Is the market trending up, or at least not falling?
2. Is the stock among the strongest over 1–3 months, with enough liquidity and daily range?
3. Is there a clear setup: consolidation, news gap or pullback to the average?
4. Is the stop at the day's low no more than one ADR away?
5. Is the size based on risk, so the stop costs no more than 0.25–1% of the account?
6. Have you decided in advance when to sell part and which average trails the rest?
7. Do you know the next earnings date?
8. Can you live through 10–20 losing trades in a row?

Risk disclaimer

This is educational material, not investment advice. Swing trading is high-risk: most trades lose, results depend on rare large winners, and historical numbers, including ours, don't guarantee future ones. Qullamaggie's rules are summarised from his public material and third-party notes; he is not involved with Signae and hasn't reviewed this description.

How Signae helps

• Swing signals on stocks in your portfolio and watchlist: entry level, stop, partial-sale plan and exit rule.
• A push notification when a strong signal triggers during the day.
• Setup statistics in R and a live journal of the trades the app has already shown.
• A position-size hint based on risk.
• Alongside: 13F filings and insider trades, and the bottom line in your portfolio return.

Signae is in closed beta: request an invite.