Some Interesting Facts About Swing Trading Strategy


Facts On Swing Trading Strategy: There are several facts or benefits of swing trading, which investors, especially who are new to trading, do not know. Here is the list of such points. But before looking into these points, let us first read what swing trading is?

Introduction To Swing Trading

  • Swing trading refers to the technique of trading which try to seize short to medium-term gains in the financial market.
  • It involves taking trades which last a few days to a few months to receive profit from an expected price moves.
  • Swing trading opens an investor to weekend and overnight risk, where the cost could open and gap the current session at a relatively different price.
  • Swing investors can take benefits by using an established reward to risk ratio, which is based on profit target and stop loss. They can also make loses or profits based on technical signal or price motion movements.

Unknown Facts About Swing Trading

1) Time

As usually seen in short-term trading, the investor requires to monitor their trades constantly. Whereas long-term trading requires a long set of trading discipline, and these trades may not be productive enough for many investors.

Swing trading apart from these long and short-term trading attracts novice, just because of the fact it applies relatively more user-friendly time frame. It takes much less time for swing traders for trading and analysing compared to that of scalpers because they carry fewer trades over longer intervals. Swing trading provides them with more time to place their positions and think about it. It also means that they invest a few minutes for a day making trades.

2) Benefiting From Longer Trends

Day trading and scalping mainly rely upon short-term volatility, but swing trading on other hand extracts advantage from long-term trends. Interpretations done on more extended units of time are often more reliable, whereas short-term trading is more exposed to false signals and noise. It also implies that every trade has a longer time interval to produce a profit, because of trade following extended trends affecting prices.

3) Cost Efficiency

The primary cost included under trading is the spread, which reflects the difference between the selling price and purchasing price of an asset. These spreads are so tiny that and they get charged each time you start a trade. It affects your profit to a great extent by cutting into the gains of ultra-short-term frequent trading.

In swing trading, the trades set fewer trades, and over larger time scales hence, spread matters less in this trading. The spread, generally a few pip or points, gets deducted less often and should thus be low compared to the volume of the net profits harvested.

4) Exploiting Larger Cost Movements

Traders practising swing trading can exploit oscillations and notable price movements which would be hard to accomplish during the day. The greater volatile the market, the more the frequency of swings and the more the number of opportunities in swing trading.

5) A Larger Range of Indicators

The swing trading units of time- weekly, hourly and daily, make it possible to fetch the most out of the normal indicators. Usually, it is seen that the analysis over larger time frames serves to be more precise, and swing trading techniques can profit from this.

Top 7 Advice For Forex Swing Trading Strategy

There are some top seven swing trading tips listed below for traders which they can adopt while forex swing trading.

  1. Adjust your trades beside the long-term trend
  2. Make the most out of MAs or moving averages.
  3. Use a small leverage
  4. Trade a broad portfolio of Forex market pairs
  5. Pay more heed to swaps.
  6. Always try to maintain a positive value of loss or profit ratios
  7. Keep your emotions on the door while trading.

The Bottom Line

Isn’t the swing trading looking attractive after these facts? If you want to read and learn more on swing trading definition, advantages, disadvantages, risk and methods of opening a trading account, then you can read more such blogs at website