Forex Swing Trading – A Good Alternative to Day Trading

The majority of new traders always start their trading business with day trading. This can mean a very short trading career. A very good alternative is Forex Swing Trading for both the beginner and the experienced Trader. Swing Traders take advantage of the changes within a major trend that take place over a period of 1-5 days. The direction of the trend is not important as you can swing trade with either the bull or the bear markets. The length of the trade is the main difference between day trading and swing trading. Because Swing Traders take advantage of strong momentum followed by a weakening of direction, they prefer currency pairings that are volatile and have large volumes of trading.

1. The advantages of swing trading is that the indicators for both support and resistance are far more reliable and you can wait for confirmation before placing a trade, where as with day trading on a volatile market it is impossible to know what is going to happen.

2. You do not have to sit at your computer all day monitoring your trades. People who are starting out and are working full time will find they are more suited to swing trading.

3. Long term trading is not for everyone, if you can set a trade and forget it, that is OK but the majority of new traders are wanting to get more involved and make a profit more often.

4. With swing trading you do not try and anticipate what is going to happen, but wait for signal confirmation and then enter the trade. Once the trade is running set a target for when you want to exit.

5. By waiting for confirmation rather than anticipating (and giving yourself a much riskier trade) you will tend to lose a little bit of the profit, this will work at both ends as you will also get out earlier. However 75% of profit is certainly better and will give you a very nice income rather than constantly trying to predict a 100% of profit and having a high number of losing trades.

6. Your swing trading system should be kept simple and as with all trading you must stick to your system for good results.

7. Swing trading with a currency pairing that has a tight spread is also important so check with your chosen Broker to find out exactly what they charge.