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Swing trading strategies are popular with many Forex traders and with good reason, there a great way to make big Forex gains, in around 30 minutes a day. A swing trading strategy is also ideal for novice traders because this method of trading is easy to understand and requires less discipline than long term trend following. Lets take a look at how to make big gains in swing trading in more detail. The logic of swing trading is based on a recurring phenomenon in the market which will never change because its rooted in human nature which never changes and its this: Traders are subject to the emotions of greed and fear and when these emotions are present, greed means prices are pushed to far from fair value on the upside and when fear is present the reverse happens on the downside. You can see short term price spikes in any currency pair and if you look at them you will see they don't last long - your aim as a swing trader is to sell into greed and buy into fear so how do you do this? Lets look at a simple Forex swing trading strategy to help you make some great profits. - Watch for a short sharp price spike to push prices to far away from the prevailing trend. - Measure how overbought the market is and for this, you can use some momentum oscillators to see if the market is overbought or oversold ( there are plenty of momentum oscillators to choose but the best for swing trading are the MACD, RSI and stochastic and you see visually if the market set up is overbought or oversold) if it is, move to the next step. - Look for a level of resistance or support you think will hold and then wait and go back to your momentum indicators. - Watch for prices to be still rising but for the momentum indicator you are using, to turn down and diverge from price, when this happens, execute your trading signal. - Put your stop in and set a target and as soon as your target is hit take the profit and move to the sidelines. Your swing trading strategy should always have a profit target - all you want is prices to correct back to fair value but don't hang around to long, as swing trading profits can disappear quickly - use a "hit and run" approach and look for the next trade. As a general rule, each currency pair will offer you a few good trades each month - don't just trade any set up remember, the more overbought or oversold the market is the better the trade. Sounds simple? It is but the best currency trading strategies are simple! You can learn to swing trade in a couple of weeks and if you get the right education, you could soon be making big profits in just 30 minutes a day. NEW! 2 X FREE ESSENTIAL TRADER PDFS
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