Swing Trading Strategy

There are so many variants in Forex trading strategy, one of the best trading strategy is swing trading. Foreign exchange traders usually can aim for swing movements by the market trend fluctuation before they open a trading position. Reversal movements in market price let forex traders to open long trading position at the best low level price. A determined swing high movements or swing low movement usually could be applied to determining money management such as risk and reward levels.

Forex traders must determine first for market price sentiment, before using their forex trading system. When the forex market is in trending movement, currency traders should aim for a swing fluctuation to have good chances for open trading position level. In this article I am going to write about swing trading strategy and how to use swing trading strategy so they can be used by trend traders.

What is a swing trading strategy anyway?

A swing fluctuation is a direct movement to the market price fluctuation being showed on the market chart. When the market price moves in one certain direction bullish or bearish, a swing trading strategy assists determine the opportunities in the market price. A swing bullish or swing high movement is finding at the high price showed on a Forex chart, and a swing bearish or swing low movement is finding at the low price showed on a Forex chart. Usually swing fluctuations can be used to determine the market trend movement, when the swing low are moving higher again and the swing highs are moving higher as well that is an indication of a strong bullish movement and when the swing low are moving lower again and the swing highs are moving lower as well that is an indication of strong bearish movement.

In the following chart you can find an example chart of the swing low and swing high in the middle of bullish trend. Forex market price already moved bullish in market price. In this spot, forex market price already moved reverse this week to build the swing low. With these movements we can find how to determine a price swing, let’s find at how we can use this chance of these situations.

Forex trading retracement

Generally Forex traders find swing trading reverse in the main direction of the market trend. These movements by bigger time momentum are called as retracements and in this retracements can give Forex traders several good trading chances.
Just like in the example chart in an extended bullish trend could be found as a chance to open long trading position into the Forex market at a lower level. To take a retracement trading system on a swing market, forex traders will find for level to place in a new swing low in a bullish trend. An open trading position could then be built if momentum pulls back in the direction of the main market trend. There are so many Forex traders use an oscillator trading indicator to set this part of their trading system with using a Forex indicator like Commodity Channel Index (CCI), Moving Average Convergence Divergence MACD or RSI Relative strength index indicator technical. Risk and reward ratio are also be calculated using swing movements. Stop loss levels can be plot below the swing low, and the target levels can be plot above the swing high.

If you want to swing trading practice, I suggest you to using demo account, with demo account you can more comfort with a new swing trading strategy when trading on your Forex technical analysis skills in real account.