Swing Trading



The meaning of swing trading is hidden in the name itself which refers to a swing. Swing trading means making wealth by taking advantage of a swing whose duration is more than a day which can be a week or even a month. This is such a trading in which both fundamental and technical analysis are taken into account and entry is made or trade is taken.

Those people are expert in making such small profits every week, if it continues like this consistently, then capital growth happens at a very good rate.


What is the profit to loss ratio?

Right now everyone's profit-to-loss ratio is different, but after a lot of research, it has been agreed that the ratio of profit to loss should be 3:1, then only you can make good wealth from trading.

Ex:
Like if a stock is of Rs 100 and your target of Rs 6 means target of Rs 106 then your stop loss of Rs 2 should be below Rs 98 With the help of profit to loss ratio, we can reduce the losses very well. Along with that, to reduce the loss, there should be trading discipline along with profit and loss ratio.


When to do swing trading?

A question will be there in your mind, if you have good knowledge of fundamental and technical and you want to grow your wealth fast without taking more risk, then understand that you can do this with swing trade. By compounding such small profits, wealth can grow much faster if there is consistency with good knowledge. basic difference between investing and swing trading?


INVESTMENT SWING TRADING
Holding period is longer  Shorter holding period 
Must have atleast fundamental knowledge  Must have both fundamental & technical knowledge 
Less risky compared to swing  Risky as compared to investment 
Chances of failure is less if company is fundamentally strong  Chances of failure is more compared to investment  

The best timeframe

1 day of candlestick chart (Candles that show 1 day's performance like high low open and close), if you are thinking of staying for a few days instead of a few minutes, then 1 day candlestick chart is the only one that can give you accurate results. It is not that only and only 1 day candlestick chart should be used, you are your own slave.