What is in the world is swing trading? The name conjures up different images. Is the trading method only for the 'hip or in the know' trader? No, the name swing trading is derived from the attempt to describe the time frame in which the trader is involved, and the pivot point on the charts that the trader is trying to optimize.

The swing trader typically trades off of time frames as low as 30 minutes for entry and exit points and daily charts for a picture of the larger trend. The swing trader is picking swing high and low pivot points on primarily daily charts for entry and exits. The trade is typically held for three to ten days. In the continuum of time frames, swing traders find themselves somewhere between day traders who typically end the day flat (no positions) versus position traders who find themselves in a position for four to six weeks.

By definition, the swing trader is quite active but does not mind holding positions overnight and through the weekend. Swing traders rely almost exclusively on technical analysis and trade on breakouts and momentum, taking profits as they present themselves. Buy and hold is not part of the swing trading vocabulary. Fundamental analysis places a very small role in their trading methodology.

It is crucial to have a rule-based system when swing trading. Success in swing trading is a result of removing subjectivity from the trading process and in being ruthlessly exacting regarding entries and exits.

Portfolio management and money management separates those who succeed from others when swing trading. The temptation can be to overweight certain positions, which can be detrimental to your portfolio and is not the professional approach to swing trading. Finally, a swing trading methodology that outlines specific rules is critical to success.

If you are interested in learning a short-term swing trading system that will give the tools to become successful, join us today MarketTamer.com.