Days to weeks, from turn to turn:swing trades ride each wave in turn.
A trading style that aims to capture gains from price swings over several days to weeks.
Swing traders use a combination of technical and fundamental analysis to identify entry and exit points.
In plain words
Swing trading is a style that holds positions for several days to a few weeks, aiming to capture one “swing”: a single move up or down within a larger pattern. It sits between day trading, which closes everything before the day ends, and long-term position trading.
See it move
Position trading: the largest here
Why it matters
Holding for days means fewer trades and less attention to each small price change, but it brings exposures a day trader avoids: positions stay open overnight and across weekends, when prices can gap, and swap is applied each night.
Worked example
An example only. The figures are round and invented for the arithmetic: they are not market prices.
A trader buys 0.5 lots of EUR/USD at 1.1000, holds for 6 nights with a swap charge of 2 US dollars a night, and closes at 1.1120.
- 1Move1.1120 − 1.1000 = 120 pips.
- 20.5 lots is worth 5 US dollars a pip, so 120 × 5 = 600 US dollars.
- 3Swap6 × 2 = 12 US dollars.
The net gain is 600 − 12 = 588 US dollars before any other costs; had the price dropped 120 pips instead, the loss would have been 600 + 12 = 612 US dollars.
A common mistake
Fewer trades does not mean lower risk. Stops on swing trades are usually set further away than on short-term trades, and a weekend gap can carry the price straight past them.
Check yourself
Educational information, not investment advice or a recommendation to trade.