Swing Trading - An Overlooked Powerful Strategy

Despite a lot of new trading strategies that have been invented in the forex trading world, swing trading is still have many users that implement it on regular basis to gain steady winning trades day after day; but apparently, this strategy is less popular among novice traders who aim for quick profits.

Swing trading is a method where the trader is placing buy or sell order close to the end of an up or down price swing that happened due to the market volatility in a given time. This position can last for a couple of days or just one day; depend on the market movement and the targeted profits.

With this method, there are a few important things to consider:
1. Support and Resistancer
Don't depend just on one chart to decide support and resistance level, instead, check a few different charts to make sure that you've had it right.

2. Using the Datar
It may be called 'swing trading', but that doesn't mean there is only one way to execute it; here are some method that have been used by many swing traders:

* Wait for the currency to turn away from support or resistance, define it as price momentum, and execute the trade.
* Wait for the price to break through the “pivot line”, identify it as uptrend/downtrend, then buy/sell accordingly.
* Using Fibonacci extension tool or just look for nearby pivot point to look exit point from the market.

3. Methods and Indicators

* Stochastic and RSI (Relative Strength Index) to identify momentum.
* Fibonacci, pivot points, and fractal measurements to identify entry point.
* MACD (Moving Average Converge Divergence) as additional tool for confirmation.

4. How much Profit?
How much profit to aim should be adjusted with the current market condition. If the market is trending or volatile, you need to get in, grab as much as you can get (within safe period), and get out quickly. This is important since as the market keeps moving, there is high chance that you’ll get a reversal. You'll need forex trading platform that can executing order quickly for this.

On the other hand, if you’re executing your trade when the market is not really going anywhere, you can aim for longer term swing trade, such as 3-4 days. Of course, your target profit will be a lot bigger with this method.

Most new traders prefer short term trading strategies due to their lust in fast profit or their low deposit, but in reality it is very hard to make many small trades during the day and keep winning. Instead, if you’re just started trading forex, you should go with swing trading since it offer simple analysis and relatively safe way to earn steady profits.