Swing trading: A calmer path to a confident start

Swing trading vs. day trading 

When people hear forex or trading, they often picture someone glued to the screen, trying to make money from every tiny market move. That’s day trading. And while it’s a popular style, it’s definitely not for everyone.

Day traders have to stay alert at all times. Every trade is fast, every decision has to be made within seconds. This kind of trading requires serious experience, solid technical tools, mental toughness and a lot of time.

Still, many new traders jump into day trading just because it seems like the default choice. And after just a few weeks, they realize:

• They’re mentally exhausted from staring at charts,
• They can’t handle the pressure of fast decision-making,
• They make emotional mistakes and lose money.

As O. Velez (2012) points out in What is Swing Trading, burnout is one of the top reasons why traders eventually shift to slower, more structured styles. And one of the most accessible ones is swing trading.

What can slow you down in swing trading

Swing trading may sound ideal – less stress, less screen time, more freedom. But like anything in trading, it’s not completely risk-free. You still need preparation and discipline.

The first challenge is patience. With swing trading, you’re not looking for instant wins. Trades can run for a few days or even a couple of weeks. You need to learn how to leave your trades alone, even if the price moves against you for a while.

The second challenge? Technical analysis. You don’t need to check charts every hour, but you do need to recognize support and resistance levels, basic price patterns, and indicators like RSI, MACD or moving averages. Without those, you’re just hoping not trading.

As Ehlers (2013) notes in Swing-Trading Strategies, successful swing trading relies on understanding market cycles, reversal points, and solid entry/exit timing. The biggest mistake beginners make is ignoring signals and trading without a plan.

And finally risk management. The longer you hold a position, the more time the market has to surprise you. Without a proper stop-loss and take-profit in place, even a good setup can turn into an unnecessary loss.

Why swing trading just makes sense (especially for beginners)

Despite those hurdles, swing trading is one of the most beginner-friendly trading styles. Why?

• No need to sit at your screen all day. You can analyze and place trades in the evening and let them play out. More time for work, school, or your personal life.
• Fewer trades = fewer mistakes. When you’re not making ten trades a day, you make fewer emotional decisions and increase your odds of staying consistent.
• More planning, less reacting. You prepare everything calmly – entry, stop-loss, and take-profit. No panic, no FOMO.

How to start with swing trading

Theory is great, but let’s get to what really matters: How can you actually start swing trading? You don’t need a huge account or ten years of experience. What you do need is a clear plan and a few basic principles to follow.

Choose the right market

Swing trading works best in markets that respect technical levels and have enough volatility. The most common picks for beginners include:

• Currency pairs – EUR/USD, GBP/JPY, or more exotic pairs like USD/MXN (these often move well and offer opportunities for swing setups).
• Stock indices – US30 (Dow Jones), DAX, or S&P 500 are popular among swing traders.
• Commodities – Gold and oil respond strongly to news and often form clear price swings.

Focus on technical analysis

You don’t need to know every central bank in the world, but you do need to know how to read a chart. Here are the basics every swing trader should understand:

• Support and resistance – Key price levels where the market tends to bounce or reverse.
• Moving averages – Especially MA20 and MA50, which help define the current trend.
• RSI (Relative Strength Index) – Shows when a market is overbought or oversold.
• MACD (Moving Average Convergence Divergence) – Helps confirm momentum and trend direction.
• Candlestick patterns – Like pin bars or engulfing candles, often signal potential reversals.
• Chart patterns – Think cup and handle, double bottoms, or flags – they offer clear entry and exit zones.

As Ehlers (2013) confirms, swing trading works best when the trader enters after a pullback and holds the position until a predefined level is reached. It’s not about constant clicking – it’s about patience.

Build your trading plan

Every trade you open should follow a well-defined trading plan. Your plan should include:

• Entry point – Why are you entering here?
• Stop-loss – How much are you willing to risk? (1–2% of your account is a common rule)
• Take-profit – Where do you expect the price to go?
• RRR (Risk/Reward Ratio) – Should be at least 1:2, ideally 1:3
  

If a trade doesn’t match your plan, skip it. Angelov (2023) emphasizes how quantifying risk is essential in swing trading. His concept of Swing-Trading Risk Magnitude (STRM) introduces a simple way to assess how much a losing trade would impact your account – and whether it’s worth taking in the first place.

Start on demo and backtest your strategy

Before risking real money, test your setup on a demo trading account. You can create a demo with any broker for free. Pick one market, one strategy, and run at least 20–30 trades. Keep notes, take screenshots, and track performance.

Banik et al. (2021) used LSTM-based analysis in their research to evaluate the quality of trade entries based on historical data. Even if you don’t have a system like that, manual backtesting can get you surprisingly far. History doesn’t repeat exactly, but it shows you what works – and what doesn’t.

Create your trading journal

After every trade, write down:

• Why you entered,
• What worked and what didn’t,
• What you’d do differently next time.

What’s next after the demo? Try a Fintokei challenge!

If swing trading feels like your thing, it’s time to level up. Sure, you could open a broker account and risk your own cash. But why burn your money when you can trade smarter with a Fintokei challenge?

How it works:

• Pick the challenge that fits you best (ProTrader Swing is perfect for patient traders).
• Pass the challenge. That means showing profit and staying inside the loss limits.
• Unlock your Fintokei virtual account and keep trading.
• Every two weeks, you can cash out part of your profits (ProTrader Swing pays 80%).
• And with your first payout, we even reimburse your challenge fee.

This is how you improve – faster than just clicking around. You’ll spot recurring mistakes and identify what strategies actually bring results.

What swing trading can give you

Swing trading could be the ideal style for you if you want to:

• trade smart, not under pressure,
• have time for work, studies, or personal life,
• build consistency and strong risk control.

Over time, swing trading helps you build a clear, repeatable, and measurable system. With the right setup, you can enjoy higher risk/reward ratios, make fewer impulsive decisions, and keep a clearer head.

Thanks to frameworks like Swing-Trading Risk Magnitude (Angelov, 2023), you also get a better idea of how each trade affects your overall account. And tech-driven methods like LSTM analysis (Banik et al., 2021) prove that even beginners can make structured, data-based decisions – if they take the time to learn, test, and build their skills the right way.

Give swing trading a shot

Swing trading is not a shortcut to instant wealth. But it can be a smarter shortcut to calmer, more sustainable trading. If you’ve been jumping between strategies, getting lost in charts, or feeling overwhelmed, it might be time to slow down. And swing trading could be the move that helps you breathe again.

What you can do right now

1. Open a demo account and try your first swing trade.
2. Choose one strategy and test it on 30 historical trades.
3. Start your trading journal.
4. Watch the markets with more patience – not every price move is worth chasing.

And remember, Fintokei’s got your back – whether you’re looking for more education, some inspiration, or honest feedback on your journey.

Resources 

_{Banik, S. et al. (2021). LSTM based decision support system for swing trading in stock market. Knowledge-Based Systems, 239, 107994. https://doi.org/10.1016/j.knosys.2021.107994}

_{Velez, O. (2012). What is Swing Trading. https://doi.org/10.1002/9781592803644.CH1}

_{Angelov, S. (2023). Swing-Trading Risk Magnitude. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4574554}

_{Ehlers, J. (2013). Swing-Trading Strategies. https://doi.org/10.1002/9781118728611.ch17}