Characteristics of swing trading include:
Short holding periods: Swing traders hold positions for shorter periods of time than long-term investors, usually a few days to a few weeks.
Capitalizing on short-term volatility: Swing traders try to take advantage of short-term fluctuations in asset prices rather than long-term trends. They will try to enter and exit the market during periods of rising or falling prices.
Based on technical analysis: Swing traders often rely on technical analysis to identify buying and selling opportunities. They look to chart patterns, trend lines, technical indicators, etc. to make decisions.
Risk control: Swing traders set stop-loss and take-profit levels to control risk and lock in profits.
Suitable for specific market conditions: Swing trading usually works better in relatively volatile market conditions because they seek to profit from price fluctuations.
Swing trading requires a certain amount of market analysis and trading experience, as well as a sensitivity to risk management. Successful swing traders are able to identify short-term market trends and trade on them in the hope of making short-term gains.