Crypto Swing Trading 101 Trading Style Insight

crypto swing trading

Uncover the Crypto Swing Trading Secrets that will Help You Succeed with this Trading Method.

Crypto Swing Trading, Understanding a Trading Style.

Crypto Trading Secrets You Want to Keep on your Arsenal. Find out how you can use this trading technique to accumulate more profits with less stress. Discover a new way to thrive in today’s market regardless of the stiff competition.

Investing in Crypto is exciting, but it’s a new world, and it’s hard to get past the hype and find an effective trading style that works for you. One of the most standard ways to invest in crypto is swing trading, which is very different from day trading. Crypto swing trading can be a great way to make stable gains in the crypto market.

You don’t need a bot to apply this technique, but you definitely can swing trade with Gunbot 🙂

Anyways, my goal with this article is for you to look at crypto swing trading, not as a better or worse than any other trading style but as another money-making strategy. You can add it to your trading toolbox or even use it as a way to diversify your existing trading strategies.

Look at it from this point of view: You can find long-distance runners and sprinters in sports. Similarly, you can compare a scalper with a sprinter, and in this example, the swing trader would be the long-distance runner.

And the same way, they both need a different physical preparation; you too need a mindset to become a strong crypto swing trader; keep reading…

Crypto Swing Trader Mindset

Swing trading is a lucrative strategy that takes time and patience to learn. It requires sound risk management techniques, excellent market analysis skills, a long-term commitment, and time to develop a strategy that works for you.

You need to be patient enough to follow through with your strategy. Because the more time you spend perfecting your techniques and adding more rules to them, the longer it will take you to develop a winning strategy.

You need to avoid doing anything based on emotion, primarily when investing in the cryptocurrency market. It would help if you were calm and collected and did not go to trade with your feelings.

In the volatile crypto market, you must stay focused on the market’s trends so you can act accordingly. Using technical analysis requires you to practice and hone these skills, then work based on the data you can see on the charts.

The reality is that trading is a risky business, and you will likely experience losses along the way. The key tho is to be prepared financially and mentally for when that time comes.

If you’re losing money, but you have a solid money management strategy in place, remember that your profits will override your total losses when your trading becomes profitable again.

What is Crypto Swing Trading?

swing trading chart example

The swing trading process has become a prevalent crypto trading strategy used by many traders in the market. This trading style has proven to be very effective for many trading various coin pairs.

Conventionally, swing trading has been defined as a more speculative strategy, as positions are generally bought and held for a predetermined time by traders. These times can vary from two days to a few months.

The main aim of the swing trader is to identify the upward or downward trend and place your trades in the most advantageous position. From there, you will follow the direction until he determines the exhaustion point and sells at a profit.

Swing traders will often use many different technical indicators, which will allow them to have a more favorable probability when placing their trades.

Crypto Swing Trading involves shorter time frames than daily charts; this usually means trading from the 240, 60, and 15-minute charts. The length of time you could be in a swing trade can vary from a few hours to a few days, and the trade can be a trend trade or a counter-trend trade.

Swing trades are often counter-trend trades because they take advantage of side moves that usually follow prolonged impulsive (trend) moves.

The term swing trading comes from the trader’s action to swing in the long or short term.
Crypto swing traders, in general, are less concerned with long-term trends than with waiting for patterns or patterns on the chart they recognize.

Some cryptocurrency swing traders are in the market all the time because they take the entire buy and sell signals in their trading plan. They know that you will capture the most significant moves when you capitalize correctly and use good money management even if they have drawdowns.

Swing traders should always have stops based on a percentage of account size or venture capital and structure on the chart like all technical traders.

Like position traders, swing traders must keep their stops far enough away from price to avoid losing positions prematurely due to day-to-day volatility and must be willing to maintain their trades through scheduled fundamental press releases.

Crypto Swing Trading Strategies

There are probably almost as many swing trading strategies used in the crypto markets as traders successfully use them. The main thing they have in common is that they trade more extended time frames than daily traders, and you don’t care if you are long or short or whether you go for or against the long-term trend.

Because they only need to check their positions periodically, they don’t need to be onscreen when in the market. However, they should monitor their positions and view charts from time to time to evaluate their strategies.

These traders can make trading decisions by glancing at a chart on a portable device or cell phone. Also, instructing the computer to send an alert or text message to their cell phones when the price reaches a certain level or technical indicator gives a sign that they trust.

They are also follow-up and OCO (Order Cancel Order) orders and other automated functions on current trading platforms.

Below are three of the best swings trading strategies

  1. Use a swing trading algorithm.

Trading algorithms are tremendous and instrumental in this bearish volatile crypto market, although it seems erratic. A bit risky, there is often a pattern. Some brokers spend millions every year researching swing trading algorithms in the hopes of gaining an edge.

Gunbot is one great bot to use when it comes to this.

2. Measure the price trend.

To use this swing trading strategy, you need to measure three different trading prices at the close of play in one of the markets. You trade long when all three averages are going up and short when all three are going down.

It is so easy to look closely at the price curves. The most straightforward strategy is to use your eyes, watch the curves, buy low, and sell high. You don’t need to have expert time here; you only buy when the currency pair goes up and sell at a higher amount.

Note that you don’t have to buy and sell on the same day. A long-term coin buy may be necessary to make a profit.

3. Use support and resistance.

Whenever you trade, you will need to find the support and resistance areas on the daily crypto chart via TradingView. Those with high volatility are good because they tend not to last long. To do this, you will need to use the Bollinger Band and Trend lines.

Read the momentum: If you are about to trade the cryptocurrency market or any other financial equipment, it supports trading indication.

There is no additional space to tighten the individual indicators. That’s why you should start with the Stochastic Relative Strength Index (RSI). You are now on the way to trade.

Crypto Swing Trading Indicators

do not chase the price, follow the trend

Moving Average Indicators: These indicators are the most widely used indicator in crypto technical analysis.

A moving average is the average of a changing block of data. For example, a 10-day moving average is calculated by adding the closing prices of the last ten periods and dividing by 10. The term “moving” indicates the prices of the previous ten days that are measured.

The moving average line is usually placed very prominently on a price change chart, and a predefined period will measure it. This indicator is usually an accurate indicator of the primary trend of the crypto market.

There are four types of Moving Averages:

  1. Simple (SMA)
  2. Exponential (EMA)
  3. Smoothed (SMMA)
  4. Weighted (LWMA)

To interpret a moving average, you need to compare the links on the price change graph between the moving average of a coin’s price and the price of the altcoin itself. If the moving average is higher, you should sell, otherwise buy.

Momentum-based Trading Indicators

Momentum-based indicators show the speed of movement, which identifies the speed or strength of a price movement. The momentum indicator is displayed on a separate indicator of the price change chart.

There are several variations of momentum-based indicators, and they are a comparison of the current closing price and the relative duration of previous closing prices. If M is the momentum indicator, CP is the current closing price, and CPn is the length, M is defined as M = (CP / CPn) * 100.

The momentum indicator identifies whether the price is going up or down and how much the price is moving. When the momentum indicator is above 0, the price has bullish momentum. When the acceleration is less than 0, the price has a bearish momentum. Dynamics-based indicators are an integral part of swing trading.

The Stochastic Indicator

The stochastic indicator is something like a thermometer used for your body. It leaves you with a rough idea of the current market status, but you have to find out the market’s future.

Sometimes it can be overbought or oversold. If the indicator shows a reading above 80, it means the overbought condition. If the indicator shows a reading below 20, an oversold has occurred. Signals are not the way to show price action or support and resistance levels.

How to Crypto Swing Trade

It sounds excellent when you think of cryptocurrency swing trading, but most traders are unfamiliar with the trading method. In swing trading, the trader is generally happy to buy stocks in the direction that the trend is strong.

Simply put, the swing trader will never trade in a smooth direction and does not match the trend. These trades are held for a few days and usually keep track of the charts of the highest period, which is around 1 hour and above, while you monitor and make your trades.

There are several distinct ways swing traders can easily place their trades and the direction of the popular trend. The standard and good practice are to wait for the price level to recover earlier, and you’ll need to enter your trade before it propagates into the feed.

Entry is usually made based on the price, which reflects in support or resistance levels, trend lines, or in many situations, may require indicator checking.

Learn to Swing Trading

To learn how to swing trading, you need to master the fundamentals of trading. The details discussed below form the building blocks of crypto swing trading and are why extreme professional investors are genuinely productive.

This domain includes the following:

  • Trading psychology: You need to develop balanced psychology to be able to function successfully.
  • Money management: This management allows the trader to minimize risk and increase the return value of his profits.
  • Market analysis: Do the market review; there are two technical analysis and fundamental analysis methods.
  • Japanese candlestick charts: This is the main element to take a look inside the stock market and its emotions. You must be able to read and understand Japanese candlestick formations.
  • Identification of trends: Swing traders increase their odds by trading in the direction of the movement. You have to find the right trend.
  • Support and resistance levels: These two levels allow the trader to find the crucial ranks in the crypto market where the trends are in his favor.
  • Fibonacci retracement levels: Like support and resistance, Fibonacci retracement levels allow you to have a good market entry.
  • Commercial indicators: Beginners should look at the technical indicators commonly used by banks and professional investors in swing trading.
  • Stop loss: Stop loss results in nothing more than minor damage; therefore, most newcomers to this business ignore it.
  • Trading hours: Always do good research and find your times suitable for opening and closing trades. Yes, even in crypto 24/7 markets!

Scalping vs. Crypto Swing Trading

crypto swing trading vs. scalping

Scalp trading means you open and close many trades on the same day. The leading consideration during day trading is the fact of support and resistance. The occurrence of daily trends plays a decisive role in day trading activities.

Scalp trading relies primarily on the fleeting emotions of buyers and sellers. The link between the feelings of the bubble (i.e., greed, fear, etc.) and the state of mind of investors (i.e., bullish, bearish, etc.) creates capital gain or loss situations.

The price movement of a coin usually exhibits trends with repetitive oscillations. The phenomenon of swings creates an opportunity for capital gain from time to time.

Swing trading is trading activity in the financial markets where a tradable coin is held for between one and several days to profit from price changes or “swings.” A swing trader does not trade daily.

Swing trading offers much greater profit potential than day trading. Swing trading demands more patience and understanding of the crypto market. The trader can maintain the transaction for a few days or weeks. It depends on the quality of the trends/fluctuations in the crypto market.

Usually, a swing trader sets a level of satisfaction throughout the swing. Still, due to unexpected longevity or trend shortening, this can increase their anxiety level or disrupt their comfort zone. These times are critical for a newbie trader who might be making impatient decisions.

Swing trading requires balanced behavior and in-depth fundamental and technical research of a coin.

An experienced swing trader buys when people sell and sells when people buy through a better understanding of future trends. You like to follow a trend until there are signs of a reversal or retracement.

Market experts define and suggest to Swing traders: Setbacks are temporary price reversals that occur as part of a significant trend.

The key here is that these price reversals are temporary and do not indicate a significant trend. The trend without retracement is an Unhealthy or Dangerous Trend.

Since the definition of an up-trend is “a series of higher highs and lows,” then logically, the trend should end when the asset fails to establish a higher high.

High is unhealthy, but that’s not the end of the trend. After setting a higher low, the price may fall back again, never forming a lower low, and then push above the previous high to reach a higher high.

The coffin of an uptrend is setting the lowest low. Instead, the trend usually ends in a reversal.

In scalp trading, the investor has small profit targets. In swing trading, the investor has pretty ambitious goals to make a profit.

Achieving goals depends on a better understanding of trends and the strength of trader behavior in the face of market trends.

An impatient/non-strategist loses money while the patient and strategist earn cash.

A compromised situation arises when the daily trading goal is attainable, but the swing trading goal is uncertain. The selection of one goal is carried out at the expense of another, i.e., the opportunity cost of daily trading profit is swinging trading profit or vice versa.

A swing trader prefers to earn dividends, so he acts proactively when a business is closed.

Benefits of Crypto Swing Trading

simple swing trading strategies

The distinction of swing trading is a vast topic as it has many different influences from many different trading strategies. All of these trading strategies are unique and have their respective risk profiles.

Swing trading can be an excellent way for market player to improve their technical analysis skills further while also allowing them to pay more attention to the fundamentals of trading.

Many successful swing traders are known to use a Bollinger Band strategy as a tool to help them enter and exit positions. Of course, for a swing trader to succeed in his strategy, he will have a remarkable ability to determine the market’s current trend and place his positions according to this trend.

It is a good note for a swing trader to place a short position to hold it for an extended period in a market that is clearly on the rise.

The general theme here is that the goal of traders should be to increase their chances of success while limiting or eliminating risk.

The swing trader’s worst enemy is a sideways or active market. Sideways price action will stop a swing trader in its tracks, as there is no dominant trend from which to disconnect.

Top 3 Crypto Swing Trading Advantages

We want to show you what we believe are three of the most significant benefits of crypto swing trading. After reading this, I’m sure you’ll agree that swing trading is one of the best crypto trading styles.

  1. You Don’t Need to be a Full-Time Trader.

Similar to Gunbot trading, you don’t need to be glued to a computer screen all day. After finding a trading strategy, all it takes is a few minutes to scan the exchange for buy signals. Because of that, crypto swing trading is an excellent trading method for beginners and those short on time.

So if you lack the time because of your full-time job or if you’re starting to learn how to trade, you can try swing trading in your spare time without having to break the sweat.

2. You Can Bank Larger Returns.

Generally, the longer your trade holds, the more room you’ll get to increase your profits, simply because you will have more margin to absorb any losses. A longer-term business will allow you to cover transactional costs and slippage, even if it means trading less frequently.

As you give more room for the trade to develop in your direction, you will ensure that you can take advantage of more significant gain opportunities.

3. Become Virtually a Stress-Free Trader.

There’s no doubt that stress hurts your trading and makes you more susceptible to making mistakes. And since you can crypto swing trade while working full time, you don’t have to worry about making money to pay your bills each month.

Of course, you want to be successful, but in this case, you’re not desperate because you don’t want to make money. What you want is to make “MORE” money, and at the beginning, trading will be your second source of income. That in itself is stress relief!

Similar to an automated crypto trading platform, swing trading is almost emotionless. These trading systems surely help to reduce the stress of the trade.

Crypto Swing Trading Tips

1. Join and Interact with a Crypto Trading Community

Trading cryptocurrencies requires a great deal of research. It’s not enough to “follow the crowd” and blindly follow the price movements of one crypto coin.

It is critical to have a vast network of fellow traders and investors who can share ideas, experiences, and knowledge. They can help guide your trading decisions because, often, they’ve found solutions to the issues you are facing.

Crypto Swing trading doesn’t have to be a lonely profession or hobby. In our case, the Gunbot community is our biggest asset, not only because we can search for solutions but because we can make friends with like-minded people and even share a joke or two, which can help brighten our darkest day.

In general, Gunbot traders are very generous sharing their knowledge and experience. Connecting with more experienced traders will go a long way in getting your trading career off to a fast start.

2. Obey Your Trading Rules, so you Don’t Overtrade

Stick to the rules you’ve set. You’ll have a better chance of making money if you follow a set strategy than if you try to sketch out some new plan on the fly. Taking trades that are not signaled by your system will cost you a lot of money in the long run.

Your trading edge relies on the rules that make up your strategy. If you deviate from your plan too often, you’re going to stay behind with a losing trade.

You might be able to make a quick profit, but going against the rules you’ve set up can make it challenging to stick with your strategy and ultimately lead you down a path of failure. Don’t Overtrade!

3. Understand Technical Analysis

Technical analysis isn’t just about market timing. It is a powerful trading tool to help you identify trends and determine when to enter or exit trades. Seeing trends early on can lead to big profits, while missing them altogether can set you up for losses.

With technical analysis by your side, you’ll be well-equipped to define a trading system based on your research and experience.

Of course, you don’t need to become a technical analysis guru to become a profitable trader. But you can’t build a consistently good trading system without at least a basic understanding of it.

What that means is that you don’t have to focus on learning what every pattern means. It is best if you concentrate on how any given technical analysis works via experience. It’s up to you to do that by testing the patterns, developing your own trading rules, and discovering which ones work best for you.

You don’t need to know how technical analysis works. You only need to be able to tell whether or not it works for you. Anything else is irrelevant.

4. Backtesting Before Trading

Never trade a strategy or idea unless you have thoroughly tested it. If you haven’t previously taken advantage of the opportunity behind your opinion, don’t jump in headfirst and gamble.

Be precise about your entry conditions, wait until you have verified the underlying fundamentals, and only trade after you are satisfied that the market will not make a sudden turn against you.

If you’re a Gunbot user, take advantage of our Backtesting addon, otherwise jump on TradingView on your own and start backtesting your strategy before you use it live on the exchange.

Backtesting is one of the essential elements in trading, but it doesn’t mean that you should trade everything blindly based on what worked in the past.

In the end, it doesn’t matter how many great ideas you have. You need to clearly understand what has proven to work before you trade with it.

Crypto Swing Trading FAQ

hanging monkey with a bitcoin on his hand

What are the differences between scalping and Crypto swing trading?

Scalping and day trading styles involve making several trades in a single day, based on technical analysis and advanced trading systems. Crypto scalpers and day traders focus on making small profits multiple times a day, while swing traders are more organized and may hold onto their positions for several weeks or months.

Therefore, the main difference is the “Time Frame,” so swing trading may be for you if you’re patient enough. On the other hand, if you enjoy the trade rush and have a crypto bot, scalping can be your best choice.

What indicators or tools crypto swing traders use?

Swing traders rely on a variety of technical indicators to find trading opportunities. They watch for crucial support and resistance levels, move averages, momentum indicators, and other specialized tools.

Crypto swing traders seek to identify and capitalize on market direction. Swing traders often look for patterns like head-and-shoulders and cup-and-handle or any other technical patterns to help improve their trading strategies.

Which crypto coins are best suited for swing trading?

While working as a cryptocurrency trader, you can enjoy success in any number of coins. The best blockchain assets are those that are among the top performers on CoinMarketCap.

A swing trader can succeed in any number of cryptocurrencies, but the best candidates tend to have active trading volume across major crypto exchanges.

These are the coins with the most liquidity and most volume and provide you the best opportunity to make money.

Is Crypto Swing Trading for Me?

You’ve been stuck in a downtrend for too long, and your investment keeps on losing value?

You’re worried about the market dropping, and you’re not prepared?

You’re nervous about investing in the cryptocurrency market because it’s so volatile?

If your answer is yes to those questions, then you probably should consider adding crypto swing trading as one of your weapons.

With Crypto Swing Trading, you’ll no longer have to worry about timing the market, and it will help you make the right trades at the right time.

By understanding crypto swing trading, you will learn how to invest in cryptocurrencies and make money without guessing the price movement because you can take advantage of opportunities as they happen.

If you don’t have the speed, the trading platform required for day trading, or the long-term attention that trend trading needs, swing trading could be the right investment option for you.

As always, this is not Trading Advice. Use this information to create your trading strategies and make an informed decision to help you profit in your trading career.

Don’t forget that the best crypto trading bot platform can help you with ready-made strategies so you can profit. Check it Out!

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