Lesson 10 of 20 · 10 min
Swing Trading
Step 1
What it is
Swing trading means holding for days to catch larger moves. Decisions are slower, there is less screen time, and it fits around a job more easily.
The costs are different: you may pay overnight financing, and a weekend or news gap can carry price past your stop, so a loss can be larger than planned.
Traders use it because each decision gets more thought, and the spread takes a smaller share of a larger target.
Step 2
See it on a chart
A rising trend on a four-hour chart, with a much wider stop.
Illustrative chart with made-up prices and tick volume, built for teaching. It is not real market data and not a trade idea.
Step 3
The exact rules
What must be true before entry
- A clear trend on a four-hour or daily chart.
- A pullback on lighter volume.
- No major event while you plan to hold.
What volume should show
Where to enter
Where the hard stop goes
Where the target goes
What invalidates the idea
- Price closes past the swing.
- News changes the reason for the trade.
When not to take it
- A major event falls within your holding period and you have not planned for it.
- You would need to watch it all night.
- You have just taken a loss and feel the need to win it back.
Step 4
Your turn: plan the trade
On a four-hour chart, price is falling and has pulled back up. Mark your plan.
This setup is a short. Look at the candles and the volume. Choose a line below, then tap the chart to place it. You can also drag its label or type a price.
Illustrative chart with made-up prices and tick volume, built for teaching. It is not real market data and not a trade idea.
Step 5
The trap: checking it constantly
A swing trade is meant to be slow, but it is easy to spend all day looking at it. Every look is a chance to interfere. Set your stop and target, set an alert, then go and do something else.
Read about screen timeStep 6