Can Swing Trading Be Used On Any Market?

Swing trading offers a trader the chance to reap massive returns but without the usual high levels of risk you may find in other styles of trading. It is possible to swing trade any market. However, there are two factors a market must posses to allow you to swing trade with maximum potential.

First, swing trading requires a market that is known to trend more than going sideways. Some markets are seemingly randomless and offer no explanation as to why they move like they do. Swing traders need a stock that trends or typical trends more than it moves sideways. A market that trends allows a swing trader to take pieces of the market as price swings up and down.

Secondly, volatile markets are not suitable for swing trading. Volatile stocks, while offering the potential of a good income if you happen to be on the right side of the trade, make it difficult to swing trade. Swing trading takes time and as a result if a stock moves too fast or too abruptly in any one direction, it does not give you time to plan your entry and exit. The best kind of stock is one that is widely and heavily traded.

Anyone can swing trade stock as long as they first make sure that it is one that tends to trend more than it moves sideways and that it does not move abruptly or erratically without explanation. Keeping this in mind will help you to gain an edge over other traders and be profitable at swing trading.


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