Dec 19 2019 1

The swing trading strategy is considered perfect for newcomers to the forex market. It doesn't require traders to sit all day in front of the trading charts or give up their day job. So if you are a beginner, learn about swing trading now. This forex trading strategy is made for you.

swing trading strategy

What is swing trading strategy?

Swing Trading strategy is a medium-term trading type that combines basic analysis and technical analysis to capture noticeable price movements and avoid trading at idle periods. in a market where traders don't know what to do.

This medium term trading style requires holding open positions for several days. The main objective is to identify the medium-term trend and enter the market only when it is almost 100% likely to win, otherwise the level of confidence must also account for more than 70% to dare to enter the order.

Swing trading is usually trading in the medium-term trend.

This method is suitable for small investors with its flexibility, while large funds due to the large scale of capital are difficult to apply this strategy, because the capitalization of the funds is very Large, so the price will fluctuate greatly every time.

Swing trading estimates prices fluctuating in a wide range. Therefore, it requires a well-judged position size to try to minimize risks.

Swing trading strategy:

What are forex indicators? 3 most common forex indicators

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Stories about the best forex strategy

Is swing trading strategy for forex beginners?

If you are a new trader, you will definitely have the main job besides this trading, so what you don’t have much is time. If you want to be a swing trader, you are primarily concerned with daily and weekly charts, and less time is spent than scalpers and day traders. It would be a smart swing trader to use both technical indicators and fundamental analysis to determine whether a currency pair is likely to experience a significant price swing or be motivated enough to change the trend. .

The principles of swing trading strategy forex

Your first task is to identify the main trend of the product. The next step is to look for overbought areas when the main trend is Down and oversold areas when the main trend is Up. And finally, find a reasonable entry point, which has a good rate of return on risk.

Once you've determined the steps you need to take as a swing trader, you need the tools, some of the technical analysis tools you need to use for your Swing Trading strategy: direction. The most commonly used indicators are moving averages, the MACD indicator. These indicators help us visualize the main trend of the index on a large graph frame.

The second type of instrument is the indicators that determine the amplitude of oscillation such as RSI, Stochastic. These indicators help us identify overbought/oversold areas on smaller graphs.

How to apply swing trading strategy effectively?

While swing trading has many advantages, it has many advantages, regardless of your style. The important thing is the news. News is especially important in the forex market, because negative or positive news can easily change currency pair trends in a flash or vice versa. When swing trading, it is important to always keep up to date with news developments such as interest rates, non-farm payrolls, etc. as it may affect the price action of your selections. You can easily do that by using the best trading apps.

The indicator tool is a good thing, but it should not be abused and only use indicators like RSI or MACD in longer time frames, because in the long time frame they are really useful. Moving Average and RSI are two powerful tools for Swing Trading forex strategy.

Swing trading strategy is suitable for those with small to medium investors. As a beginner, you should not go against the trend, because the trend will be very dangerous for you.

swing trading strategy forex

Swing trading strategy is completely different from scalping strategies (only takes a few minutes), or day trading strategy (holding orders during the day). Swing trading is a type of trading that holds orders from a few days to several weeks. Therefore, traders who follow swing trading use technical analysis to find entry points. However, the nature of these traders often prefer the information of the index of the currency pairs rather than completely depending on the trends and patterns in technical analysis. So you need to find out the news in the economic calendar to predict the trend. Check out the differences between day trading and swing trading.


Mario Draghi

Hey, I’m Mario Draghi. I’m a writer currently resided in Thailand. For my forex experience, I have been working with brokers and trading for 5 years. Hope that you'll enjoy my articles about all forex-related matters.

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1 Comment


Oct 25 2020

Anyone care to share how trading helped them with everyday living?


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