Swing Trading Strategies - Detailed Guide to Win Using Swing Trading

Swing trading is where you open your position from a day to several weeks. Keeping a position open for that long can be quite risky, especially in forex market where the market movement is really volatile, thus you'll need solid swing trading strategies. There are a lot of swing trading strategies out there, but it is best to choose the one that match your trading style.

Pinpointing the Trend

The goal of swing trading is entering trades in the direction of the major trend. Thus, pinpointing the trend is definitely an essential first step to master for a swing trader. The earlier you can recognize the trend, the higher your chance to generate enormous profits.

However, you can't just concentrate on identifying treds because you have to keep an eye on whipsaws (a condition where a sharp movement followed by sharp reversal) too. It can be misleading and looked just like the market is trending, so make sure you can avoid it. These are several common methods to discover trends:

- Making use of indicators: the most commonly used indicators are Moving Averages and Relative Strength Index.
- Price Action Trend
- Pivot Point Trend
I would suggest using 15 minutes and 4 hours charts for this.

Wait For Pullback

As soon as you identify the main trend, don’t rush and place your order. Wait for some sort of pullback first to get a good entry point. By waiting for a good price level before truly stepping into the market, you’ll enter at a good price and have better opportunity to score profitable trades.

Stop Loss

Every good trader applies strict risk management and stop loss is among it. For stop loss, simply use the most recent swing high or swing low. Ensure you place your fund in a reliable broker that will not overlook your stop loss.

Closing the Position

The easiest way is to aim for the same quantity of the pips you are risking. Illustration: if your stop loss is 20 pips under your entry point, then simply set 20 pips above your entry point as the exit point (take profit order). Of course, it's possible to aim higher than the amount of pips you risk; it’s completely up to you.

This is just one example since there are a lot of swing trading strategies around. A few of them may need you to learn more complex techniques or using more sophisticated software; nonetheless, if you’re still learning, it is best to stick to one currency pair and get used to it. Furthermore, know the best time to trade for that particular currency pair.

There are hundreds of strategies variation for swing trading, but the fundamental is the same: finding a trend and ride on it to get as much profit as you can. Just like that. People just discover a lot of different way to do that, so just go with one that suits you the best.

Read more about numerous variations in trading strategy in currency trading strategies. Moreover, have a look at best online forex broker and make sure you put your money in an honest broker.