Is Forex Swing Trading Good For You?
Swing trading is another trading style that many traders use to reap great benefit from the forex market. It is for those who HQBroker Forex Bonus a little more patience than those who like to see some actions throughout their trading day.
Swing trading is a longer-term trading style that will require you to hold your trades for several days each time.
Swing Trading Basics
Swing trading isn’t that bad for those who have a lot of free time. But for those who do not have much time to FX Bonus spare, this trading strategy can be the key for them to earn big from the forex market. The only thing you really have to do allot maybe a couple or so hours every night for the analysis of the market.
If you have a full-time job, or if you still go to school, and spend most of the hours in a day outside your house and on some other stuff, swing trading might be best for you. On the flip side, you still have to keep yourself in the loop about global economies.
What does a swing trader do?
A swing trader’s job is to find “swings,” as the name suggests, within a medium term trend, entering only when he or she spots a likely high probability of winning.
For instance, imagine you’re currently in an uptrend. Your primary goal will be to buy, or go long, during swing lows. Conversely, you can try to sell, or go short, if you want to gain some profits during brief countertrends.
About Stop Loss Orders and Volatility
Unlike other shorter term strategies, you’ll be holding your trades for days on end, meaning you’ll be affected by more fluctuations.
What you have to do is set larger stop loss orders. You do this to withstand volatility. In addition, you must adapt this to your current money management plan.
These are very important since you will almost certainly see your trades go to unplanned directions while you’re holding them. It’s also important that you remain calm and level-headed during such times. You need to trust your analysis and be confident with your plan.
Trading pairs with larger spreads and lower liquidity may also be fine. This is because spreads do not have much influence on your overall gains. Blame this to trades having larger targets.
When to become a swing trader
To become a swing trader, there are very simple “requirements” that you should meet.
First, you shouldn’t be very antsy about your trades, meaning you are willing to hold them for several days. Second, you must be willing to hold fewer trades. And while you’re doing that, you should ensure that each trade is thoroughly planned and analyzed.
Bear in mind that you have to be very patient, meaning you should also have a bit higher risk tolerance. You need to be like this so that you can control yourself when the trade goes against you, which will not be uncommon.