Why Is Swing Trading in Forex Popular?

Swing trading in Forex is a form of quick trading performed by investors aiming to maximize profits and minimize risks by making strategic trades that last from 3 to 30 days. This is a very popular style of trading among investors and day traders across the globe. Swing trading depends on short-term variations in the market, forcing traders to react to the changes in a rapid manner. This form of trading depends more on stress price patterns than actual value.

As a trader, you do not wait for currency prices to hit either high or bottom, but wait for short term fluctuations in the market. Swing trading is highly favored by day traders, rather than by large financial establishments or brokerage houses. Swing trading is most profitable when markets are stable.

Advantages of Swing Trading in Forex

The reason for swing trading in Forex being popular is the many advantages it offers over other conventional forms of trading, like buy-and-hold investing and position trading. The returns tend to be higher for an average trader. You can, for instance, trade for a short while and pay your monthly bills. Swing trading is, however, subject to market fluctuations and conditions. Like all forms of trading, swing trading is susceptible to lean phases.

When executed properly, you will experience less risk as compared to other methodologies. Unlike conventional investors whose fortunes are tied to bulls and bears, swing traders are free to exit losing trades and step out. There is an exit strategy for swing traders. Another strategy for a swing trader is to short the market even when the market suffers a slowdown.

Swing traders can have a flexible schedule unlike most day traders. All you need is to do some market research after work, and place new trades the next morning when the markets open. This style of trading offers more attractive returns due to its less labor-intensive requirements. You also need not worry about:

  • Scrutinizing financial statements like most investors
  • Monitoring market crests and troughs like position traders
  • See your profits vaporize before your eyes due to unfavorable market conditions
  • Using complicated systems like other traders

Swing trading is popular because of the flexibility it offers. In short, swing trading gives you the highest returns in the least amount of time.

by Kitz S


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Forex trading bears intrinsic risks of loss. You must understand that Forex trading, while potentially profitable, can make you lose your money. Never trade with the money that you cannot afford to lose! Trading with leverage can wipe your account even faster.

CFDs are leveraged products and as such loses may be more than the initial invested capital. Trading in CFDs carry a high level of risk thus may not be appropriate for all investors.