What is swing trading? Strategies for making money from market fluctuations

Swing trading is an approach to trading aimed at profiting from short- and medium-term price movements. Cryptocurrencies, other assets - it doesn't matter. Positions are held for several days, sometimes weeks. It can even be months. Technical Analysis is the main tool here, it seems.

Experienced traders do not limit themselves to just charts. They add a bit of fundamental analysis. Just for reliability.

Key Aspects of Swing Trading

Holding assets for a few days or months is the essence of swing trading. There are risks. Night, weekends – prices can change sharply while you sleep. A bit scary. Swing traders usually know their risk/reward ratio clearly. Stop losses, take profits – everything is predetermined. Or they simply look at the charts and make decisions.

Features of Swing Trading

A typical swing lasts more than one trading day, but not longer than a few weeks. Approximately like that. There are exceptions. Some trades get prolonged. Sometimes, during extreme volatility, a swing can happen in one day. It's a rare occurrence.

The main thing is to catch a significant part of the price movement. Not the whole movement. A part. Some people love crazy altcoins in a bull market. Others prefer more stable coins. It doesn't matter. You just need to guess the direction, open a position, and take profit.

Successful swing traders are not greedy. They take a portion of the potential profit – and run further.

Advantages and Disadvantages of Swing Trading

The risk-to-reward ratio is a key point. Entry, stop, profit – all on the chart. If you risk 1 USDT but can take 3 USDT, that's good (1:3). Are you risking 1 USDT for a chance to earn only 0.75 USDT? Not the best idea.

Technical Analysis prevails. But fundamental is also useful, don't ignore it. Do you see the bullish trend of BTC? Check the fundamental indicators. They should confirm the trend.

Daily charts are fundamental. Hourly or 15-minute charts are for precise entry.

Advantages:

• Less time is spent compared to day trading.
• You can catch a significant part of the market movement
• Technical Analysis simplifies life, you have to think less.

Disadvantages:

• Risks at night and on weekends. Woke up – and there are gaps.
• Sudden market reversal? You can lose quite a bit.
• Long-term trends are often overlooked. It's somewhat disappointing.

Swing Trading Strategies

Multi-day charts – this is where patterns are sought. Crosses of moving averages, "cup with handle", "head and shoulders", flags, triangles – the classics of the genre. Candlestick reversal patterns are also useful.

Every swing trader eventually finds their style. Some approach works more often than others. Not always, of course. Nothing works all the time. But with a good risk/reward ratio, you don't need to win every time.

What does "swing" mean in swing trading?

"Swing" refers to identifying entry/exit points during daily or weekly fluctuations between bullish and bearish cycles. Back and forth, like a pendulum.

How does swing trading differ from day trading?

A day trader makes a lot of trades in a day. Dozens. Charts, Technical Analysis, complex systems. Small profits many times. And no open positions overnight. A swing trader is different. He holds positions for days, weeks. And fundamental analysis is more important to him.

Which cryptocurrencies are best suited for swing trading?

BTC and ETH. The highest liquidity, active trading. The classics. In active markets, they often move between clear levels. Back and forth. You can catch these fluctuations. Of course, commodity and currency markets will work too. The main thing is liquidity and activity.