Swing Trading and features of Swing Trading

Swing Trading is considered a style of trading that holds a position from a few days to a few weeks, hoping to profit through medium-term fluctuations and only entering orders when the success rate is high. more than 70-80%.

Transaction time

Usually, those who follow the Swing Trading school will trade based on large time frames like H4, D1 and hold orders from a few days to a few weeks. Therefore, this method is very suitable for those who are just starting to trade or who cannot spend much time on trading.

You will not need to sit continuously on the computer for hours and hours like Day Trading, but in my opinion, this will take up a lot of people’s time but cause psychological discomfort when trading.

However, even though Swing trading is based on large frames like H4, D1, traders still have to look at smaller frames like M30, H1 to find the entry point, Stoploss, Take profit more accurately.​

Can flexibly combine Technical Analysis (TA) with Fundamental Analysis (FA)​​

For Swing Trading, usually people will combine technical analysis (TA) and fundamental analysis (FA). With the aim of maximizing the success rate of the trade, after having approved the TA to set up a trade, a Swing Trading style trader will consider the FA factors in favor or not. not to determine whether to proceed with the transaction.

More likely to succeed

Also because trading on medium-term frames H1, D1, Swing Trading style also limits deviations in smaller frames in Day Trading due to times when the price is noisy and does not follow technical analysis due to good news. price whale. Therefore, technical analysis will be more suitable for Swing Trading style traders.

For example, the moving averages (MA) of the H4, D1 frames are always more valuable than the M15 and M30 frames, leading to a higher probability of successful trading.​

Optimizing profits with Risk/Reward ratio​

After determining the entry point and time through TA and FA, most seasoned traders will not enter orders immediately but also have to consider the R/R ratio. An R/R ratio is considered acceptable when it is above 1:1, maybe 1:2, 1:3 which means that 1 win will make up for 2 or 3 losing trades.

Leave a Reply