Swing Trading


DEFINITION of 'Swing Trading'

A style of trading that attempts to capture gains in a stock within one to four days. Swing traders use technical analysis to look for stocks with short-term price momentum. These traders aren't interested in the fundamental or intrinsic value of stocks, but rather in their price trends and patterns.

BREAKING DOWN 'Swing Trading'

To find situations in which a stock has the extraordinary potential to move in such a short time frame, the trader must act quickly. Therefore, swing trading is mainly used by at-home and day traders. Large institutions trade in sizes too big to move in and out of stocks quickly. The individual trader is able to exploit such short-term stock movements without having to compete with the major traders.

  1. Wide-Ranging Days

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  2. Day Trader

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  3. Profit Taking

    The act of selling a security in order to lock in gains after ...
  4. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  5. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  6. Stag

    A slang term for short-term speculator. A stag would be equivalent ...
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  1. How does a swing trader use the stochastic oscillator?

    The stochastic oscillator is a momentum technical indicator used to indicate points of possible price reversals. Swing traders ... Read Full Answer >>
  2. Why is a Turtle Channel important for traders and analysts?

    Like most channel indicators, the turtle channel's importance for traders or market analysts lies in the fact that it is ... Read Full Answer >>
  3. How do I use a Turtle Channel to create a forex trading strategy?

    The turtle channel can easily be used as a trend trading tool and also adapted for swing trading within a trend. The turtle ... Read Full Answer >>
  4. What is the Turtle Channel formula and how is it calculated?

    The turtle channel is intended to circumscribe price in such a way that any breakout from the channel should be a definitive ... Read Full Answer >>
  5. What is a common strategy traders implement when using the Qstick Indicator?

    A common trading strategy traders implement using the Qstick indicator is to try to take advantage of a market reversal signal ... Read Full Answer >>
  6. What are the main strategies traders execute when using ascending channels?

    A channel is basically defined as the space between two roughly parallel trendlines and is often used to denote a trading ... Read Full Answer >>

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