Swing Trading Strategies

Swing trading is a short-term trading style. In this, you can hold stocks for less time, cut quick losses and make small profits. Your rules need to be specific to a shorter time frame and the gains can compound to huge profits over time.

Basic Strategy: Lower gains, Lower losses

The first profit goal should be 5% to 10% and the difference would depend on the holding period of the stocks. Swing trades don’t last for many months and it is more likely for a couple of weeks. You will see the stocks going up and think about selling them too early but the market corrections will also be avoided with it. You might end up too early but purchase the stocks on their recovery.

The quicker profits can be obtained with making rapid moves in buying and selling which is termed as swing trading. Make sure that your selling ideas don’t include losses and the portfolio remains healthy. You can make positive trades and get a lot of money by keeping your losses smaller in comparison to your profits.

Swing Trading Basics

Swing trading is the methodology including ‘one move’ concepts. The major idea is to ensure lesser pain by exiting the trades at the right time. You can book your profits before the market reverses its position and keep your gains aside.


  • Majorly suitable for a person doing a full-time job
  • Comparatively less stressful in comparison to day-trading
  • Trades last only for a few days or weeks and you don’t need to check out your monitor all the time for trading


  • High-risk investments
  • Riding trends won’t be possible

Swing Trading Strategies

Stuck in a box

  • Identification of the range market
  • Waiting for the price for breaking down below the Support
  • Waiting for the strong price rejection (above Support), in case of the price dropping below the Support
  • Going to the next open candle with the price breaks below the Support
  • Setting the stop loss 1 ATR below the candle low and trying to make gains before the Resistance

Catching the Wave

This works in making movement in the trending market. The major idea is to make identification of the trend respecting the 50MA. If the market is approaching the moving average rate, then you can wait for the bullish price rejection. After getting the rejection, go on towards the next candle. Set the stop loss 1 ATR below the low value and get profits before the swing gets high.

Fading the movement

Fading here means to ‘go against’. You can get against the momentum and the general movements to talk about this concept.

  • Identification of a strong momentum moving into Resistance taking out to the previous high values
  • The strong price rejection can be checked out
  • Going for next candle and setting the stop loss 1 ATR above the high values
  • Taking profits before the nearest low swing value

These are the major three types of swing trading strategies worked out by investors. The major thing to look for is your trade management skills. Management of your trade with confidence is essential to carry out the processes with confidence and conviction. There are active and passive trade management skills to carry forward the processes. The active trading will include the market reaction watch and making the decision for holding or exiting the trade. Passive trading will make you let the market hit the stop losses or the targeted profits and in between, there would be nothing done at all.

Author: Travis

Started investing in 2013 with $8,500 I turned that into 180k within a few months. Every year since I have increased the amount of money made from micro cap stocks and stock options.

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