Swing Trading strategies

Do you think about the traders making money in Forex Trading?

Do you think they might be sitting in front of their monitors and staring at the chart the whole day?

Actually, Not all the traders sit watching the charts whole time.

So what strategies they use?

Swing Trading strategies.

Have you ever wondered the markets always go in the opposite direction of your trade?

Have you ever felt the price is almost near to the take profit and suddenly goes back opposite?

Seriously horrible..

If you think you are facing this frequently, then there is a great strategy that works for you.

The Swing trading strategies work perfectly to predict the take profit and stop losses.

What is Swing Trading Strategy?​

Swing trading is just capturing a swing of price moment. It is short-term trading where trading lasts for a day or few and you can capture a whole swing in price bottom to up or up to down.

Have you ever sat on a swing in a park or your home? Do you remember how does the moment happen? Front and Back… and continues until it slows down.

The same swing applies to price moment in the forex market but the direction is up and down.

The main goal is to capture the price moment and pocket some profits.

In Forex Trading, the Swing happens when the price is observed to go up and down in the same pattern and continues.

Swing Trading in Forex​

  • Takes less time to trade than other trading strategies
  • is best for part-time traders
  • has fewer signals but high profitable. Don’t worry about signals, you have 50+ pairs to trade whenever you have time.
  • makes you less greedy to trade as the signals are less
Most of the swing traders spend less time compared to other traders. Being a swing trader, you can target a better risk and reward ratio.

Isn’t that exciting?

In this post, I will be swinging with the 3 best swing trading strategies in forex that works

1. Support and Resistance​

This strategy helps in identifying better take profit and stop loss levels.

Support and resistance is the common word you might be hearing in forex. This helps to identify better entries in swing trade.

Let us see what it means and how is it related to swing trading.

Support is just where the price stops falling and reverses to go up.

Resistance is where price stops rising and reverses to fall.

In Swing trading, you will make use of these moments to make profits.

All you need to identify if the price is stuck between supports and resistances.

It mainly happens when the market is ranging with little moments.

The size of the moments depends on the timeframe you have selected. Higher timeframes will have more pips difference and you can target good profits.

Just wait for the price to reach the support and if there is a strong rejection, just open a buy trade with take profit as resistance level.

“Easy Peasy” is it? Just practice it to make it easy.

Similarly, you can trade resistance, when the price reaches resistance and turns back with a strong reject, then open a sell trade and close when the price reaches a support line.

2. Fibonacci Retracement​

swing trading strategy with fibonacci

Fibonacci works best when the market is trending.

The price is going up and up or continuously going down. Whichever, way the price is going, you can make use of Fibonacci.

This is similar to support and resistance but here we deal with levels instead.

Fibonacci indicator is available for almost all platforms.

All you need to do is to draw a Fibonacci indicator from the lowest point to high.

As soon as you do that, you can find there are multiple levels formed between high and low.

0, 0.236, 0.382, 0.50, 0.618, 0.764 and 100. The levels helps us to identify the potential reversal points.

The above image shows how it appears in a bullish trend. The price reached the top and started coming down.

Now, you should find a level where the price is rejected strongly and we can do a buy there.

Swing trading with fibonacci

In the above image, there is a strong rejection at 0.618, open a buy trade.

There is a lot to learn about the Fibonacci strategy. You can find those strategies at BabyPips or ForexFactory.

3. Trendline Trading​

This strategy also works well with Trending markets.

The Trend line or Moving average strategy is simple of all swing trading strategies to try.

All you need to do is draw a trend line connecting all the lowers.

You may use a simple moving average. I prefer 200 period SMA as I prefer higher targets with small risk.

swing trading strategy

This is a very simple strategy as you don’t need to update your trend lines, the moving average updates itself with price moment.

Only very few rules to trade this strategy.

swing trading strategy moving average
Swing trading using moving average

Check the direction of the trend, wait for the price to reach 200 period moving average or trend line. Check if the price is rejected to break the line. If rejected Open the trade in the trend direction.

Did I Miss Something?​

Most of the readers get next level query. Which strategy should I follow?

The same old line appears here..

There is no perfect strategy. But there are perfect ways to make your strategy profitable
Take any forex strategy, just do a back test to find whether your strategy is profitable by % of probability.

With this calculation, you can make plan to risk – reward ratio.

Practice any strategy until you are comfortable to trade before going live.

Still having queries? I would love to answer them comment here.