What is Swing Trading & Strategy to use
Traders who known as Momentum Traders often use Swing trading to make their day living and Swing trading remain always in trend for the all the traders and It is one of the best trading plan to do day trading. As its name states, Momentum trader; it means When any big Price movie is about to come whether it could be in bullish face as well as bearish face. Position take by in swing trading could last from a single day to couple of days depends upon your trading strategy.
As our articles states, What is Swing Trading & Strategy to use ; Firstly, we’ll introduce you with Swing Trading and how can you use it with a strategy to make your profitable trade.
What is Swing Trading
People are using Swing trading from 1900’s and this strategy is known as the best strategy to find out any big price move. Swing Trading is best use in Future as well as options, Because it involves more future speculation than any other. If you are searching for “Buy and Hold strategy” in stock trading, This is not meant for you. Because, Investor are to hold stock for long term and they go through many Ups and Downs. But, Swing trading for those who are there to run acc. To market flow. Swing traders when any movement in stock starts and get out before finishing that movement.
Which stock to use for Swing Trading in Share market
By Swing Trading, you can speculate about stock trend, future prices and movement of stock. By momentum, We mean that movement of price acc. to movement of time. Increase in movement of price simultaneously increase your profit in trade and It will help you to exit trade in profit. Swing trade is difficult to apply on low volume stocks and less volatile stocks.
To find out the best candidate for Swing Trading, Check the volume gainers of last day/week and check volatility for the same time; It will help you to get entry in stock which is about to make a big price move in less time.
Trend could be bullish as well as Bearish & we know what to do in that case; If Trend is bullish, Buy the stock and If trend is bearish, Short the stock.
Strategies for Swing trading
Every Swing Trader has different philosophy to confirm the Entry/Exit Price & Break out of Exponential Mean Averages is one of the best strategy which is often used by the stock traders. There are many more methods for Swing trading, other methods are H & S Flags, Pennants & wedges etc.
- Find out curve for last 20 days Exponential mean Averages.
- FInd out curve for Last 50 days Exponential mean Averages
- Now, Find out the Intersection price, If 20 day EMA is crossing 50 day for upward direction, You can count this as bullish trend and if It is crossing for downward direction, You can count it as bearish trend.
Benefits of Swing Trading for Traders:
- You don’t have to get attached to screen for the whole day.
- If you master this strategy, You can exit your trade in early mrng with profit.
- No need of any specific capital requirement.
In the end, Swing trading is for them who can capture the price move in short span of time, who can exit the trade at a best time and want to take their trader for more than couple of days.