Swing Trading

Swing trading is a trading style where you hold positions for several days to a few weeks to profit from short- to medium-term price swings in the market.

Key features of swing trading

• Time frame: Days to weeks

• Trades per week: Low to moderate

• Markets: Stocks, ETFs, options, forex, crypto

• Analysis used: Mostly technical analysis, sometimes fundamentals

• Monitoring: Not constant—positions are held overnight

How swing traders make money:

Swing traders try to:

• Buy near support and sell near resistance

• Enter trends early and exit before momentum fades

• Capture a “swing” within a larger market move

Trading strategies for swing trading can be classified as:

• Trend Following
• Momentum
• Breakout
• Mean Reversion

Common swing trading strategies

• Trend pullbacks: Buy dips in an uptrend

• Breakouts: Enter when price breaks key levels

• Reversals: Trade when momentum shifts

• Moving average strategies: Using 20-, 50-, or 200-day MAs

Risks

• Overnight risk: News can move prices while markets are closed

• False signals: Breakouts can fail

• Market reversals: Trends don’t always last

Swing trading vs day trading

Bottom line

Swing trading is often considered more beginner-friendly than day trading because it’s slower, requires less screen time, and allows more time to make decisions—but it still involves risk.