What is Swing Trading in Stocks?

Swing trading is a medium-term trading style that is used by traders who like to profit from upswings and downswings in stock prices.

How Does Swing Trading Work?

This trading style requires patience as swing trading trades are usually held for a few days at a time, from a minimum of two days to several weeks.

It’s the ‘swing’ in the asset’s price, from one price value to another, that gives the trading method its name. 

The key is to keep an eye on the movement of different shares so that a trader can get in at a level that’s appropriate for them, and get out a short time later with a profit.

This trading strategy stands between two other popular trading styles: day trading and position trading.

It is ideal for those who can’t monitor their charts throughout the day but have a couple of hours to spare every now and then to analyse the market.

🙂 You might be a Swing trader if:

  • You are patient and you like holding your trades for a couple of days.
  • You take your time deciding what trades to take.
  • You have a full-time job but enjoy trading on the side.

☹️ You might not be a Swing trader if:

  • You are impatient and like to know if you are right or wrong straight away.
  • You can’t spend a couple hours every day analysing the markets.
  • You like fast-paced trading.