Swing trading is a popular strategy that focuses on capturing short- to medium-term price moves. Unlike day trading, which requires closing positions by the end of the day, swing traders hold assets for several days to take advantage of expected upward or downward market shifts.
Swing traders often rely on technical analysis rather than fundamental data. Common tools include:
- Moving averages
- RSI (Relative Strength Index)
- MACD (Moving Average Convergence Divergence)
These indicators help identify trends and potential entry or exit points. For example, if Tesla stock breaks out of a resistance level on strong volume, a swing trader might enter and hold until it reaches a higher price target.
Advantages of swing trading include:
- Less time-intensive than day trading
- Opportunities in both rising eli lilly and company invest falling markets
- Applicable to stocks, forex, crypto
However, risks exist. Market gaps, sudden news, or poor timing can lead to losses. Its crucial to:
- Use stop-losses
- Have a defined plan
- Avoid emotional decisions
Swing trading works well on platforms like TradingView, Thinkorswim, or Webull, where you can access advanced charting and paper trading.
If youre looking for an active strategy without the stress of intraday trading, swing trading offers a balance of structure and flexibility.
