Swing Trading – Definition
Day trading and swing trading are an alternative way of earning a living, but there are differences between them. The degree of difficulty, the amount you can expect to earn and the amount of money required to start will help you decide if day trading or swing trading is right for you.
Swing Trading – Strategies
1. The Degree of Difficulty of Swing Trading
The costs of day trading are extremely high. It will even be difficult to take a few minutes to go to the bathroom while trading is going on. You will have to analyze charts and make fast decisions before you can begin to make one trade. Some people can make trades for several hours each day, but I know that sitting in front of a screen all day is very hard to do. This is a very important swing trading indicators.
Swing trading techniques is much easier. You have to keep an eye on your stocks to know what is going on, but you can be more casual. Swing trading means that you will plan when you are going to enter a trade and when you are going to exit, but you aren’t going to be making as many trades. Try reading some swing trading books to get a better understanding.
2. The Amount You Can Expect to Earn from Swing Trading
Swing trading doesnt take a long time to complete a trade in day trading. You can trade with one-, three-, five- or 15-minute charts. Because this is a course way of trading, you must be able to alter the amount that you expect to earn with each trade. The fact is that making money from this type of trading means that you must earn more than a few pennies on each trade. Start swing trading stocks today.
You have the potential to make more money with swing trading strategy. You have the option of aiming for a 20 percent gain or even more. Swing trading allows you more time, and that’s why there is a possibility of earning more money. This makes swing trading a lot of fun. For example, if you have a set profit target, you can allow your profits to run because you have a longer holding period.
3. The Amount of Money Required to Start Swing Trading
The cash to expenses ratio needed in a full-time day trader’s account is 50:1. Those who have an extra source of income can bend this rule a little. If your monthly expenses are equal to $3,000 a month, you will be required to have $150,000 in your account before you can begin trading. If you were thinking that this number seems high, you would be right. The point is to make sure that you can afford to trade without losing everything. You should also be careful with which swing trading software and swing trading system you will use.
Swing trading can be done in your spare time while you keep your job, so you can decide how much money you wish to risk. If you want to quit your job, then your cash to expenses ratio must be 100:1. This number is higher because swing trading can take as long as a month to complete, so you won’t have a source of income during that time. With this higher ratio, there is only a risk of losing one percent of your capital every month if your trades last longer than you expected. These are different swing trading strategies. You can also learn these in different swing trading tutorials.
Swing Trading – Useful Links
- Definition of Swing Trading on Wikipedia
- Another Definition of Swing Trading on Investopedia
- Useful resource about Swing Trading on Investopedia
- Learn more about Swing Trading