Swing trading strategy is a trading strategy focused on taking advantage of short to medium-term price changes in stocks, and positions are typically held for a period ranging from a few days to a few weeks.
*Types of swing trading strategies:*
- *Fibonacci retracement*: Used to identify potential support and resistance levels in the market, helping to determine entry and exit points.
- *Support and resistance levels*: Used to determine entry and exit points based on previous support and resistance levels.
- *Channel trading*: Used to identify strong market trends and take advantage of fluctuations within the channel.
- *Moving averages crossover*: Used to identify entry and exit signals based on the crossover of moving averages.
- *MACD indicator crossover*: Used to identify entry and exit signals based on the crossover of the MACD indicator ¹.
*Principles of swing trading:*
- *Determine the trend*: Identify the overall market trend before entering any trade.
- *Use technical indicators*: Utilize technical indicators such as moving averages and the relative strength index to determine entry and exit points.
- *Risk management*: Set stop-loss orders to determine the maximum potential losses.
*Best practices
Use technical analysis before entering any trade in a volatile market.