As swing traders, we want to trade those instruments that have a high level of trading activity in terms of volume and thus offer great liquidity. Additionally, we want to ensure that the currency pair has sufficient volatility.

Liquidity is important because it provides us the ability to trade in and out of our positions with minimal slippage cost or market impact. The most liquid forex instruments include the major currency pairs, and a few cross currency pairs.

As for the requirement that are chosen instrument have a sufficient amount of volatility , what that essentially means is that we want to ensure that the instrument has enough movement for a trade to make sense. This condition will further narrow the prospect list. Below are the five best Forex pairs for swing trading based on having both high liquidity, and high volatility characteristics.

EURUSD — This is the most liquid currency pair within the foreign exchange market. It is widely traded throughout the globe, and the price movements within this pair make it ideal for a swing trading approach. GBPUSD — The British Pound to US Dollar currency pair is very actively traded.

It often has a strong correlation to the EURUSD currency pair. AUDUSD — This is a favorite among traders in Australia and the Far East. EURJPY — This is a very liquid cross currency pair that is often characterized with large daily price swings which can sometimes exceed pips. It is a favorite among more active swing traders looking to capture short-term price trends. GBPJPY — The Pound to Yen currency pair is highly volatile, and is most active during the European and Asian sessions.

Minimal Time Commitment — Most swing trading strategies can be managed in less than an hour a day. This is something that is hard to grasp for many beginning traders, but it is certainly true if you have a focused process in place. Lower Transaction Costs — Many forex swing trading systems will only trade several times per week. As such, you can expect to generate approximately 75 to trades per year. This is the normal range of activity for most swing traders.

Compare that to day traders who will routinely take several trades per day. This can result in anywhere from several hundred to even a thousand trades or more per year. When you factor in the total transaction costs including the indirect costs of bid ask spreads , slippage, and commissions, a swing trading methodology will clearly be less expensive.

More Reliable Trade Setups — With a swing trading approach, you will be focusing on holding positions for as little as a few days to as long as a few weeks.

The price patterns that occur on the various swing trading time frames are much more reliable compared to those that occur on both the smaller day trading timeframe, and the larger position trading timeframe. The day trading timeframe is filled with noise which can make it extremely difficult to trade efficiently. The position trading timeframe can be heavily influenced by both fundamental and geopolitical factors which can also make it more challenging. More Types Of Strategies To Test — The majority of long-term position trading systems tend to be trend following in nature.

They will typically look for some sort of momentum breakout, and seek to enter in the direction of the breakout for a potential trend move. Many daytrading systems are based on a volatility breakout methodology, or some sort of mean reversion technique based on short-term sentiment extremes. Swing traders will find that there are many different types of trading styles, and methodologies that they can study and use to build their own customized swing trading EA or model.

There are many different swing trading indicators and tools that can be employed. Some of these technical indicators are momentum based, others volume-based, or sentiment based to name just a few types.

And there are countless variations that can be studied and tested. Some traders, however, prefer to keep it simple and rely exclusively on price action analysis. Price action trading is a timeless market analysis technique and one that is very well suited to the swing trading time frames. So what exactly is price action analysis? As you may be aware, most trading indicators are derivatives of price itself, and thus the information that we gather from such indicators has a delayed or lagging effect.

Horizontal Support and Resistance — Support represents a key price level below the current price. Resistance represents a key level above the current price.

It is a level where we could expect to see supply enter the market, which may lead to a minor stall or possibly a reversal to the downside. Candlestick patterns are usually one, two, or three candle formations that can provide short-term clues into future price action. Below are a few examples of the shooting star candlestick pattern, which has a bearish implication.

Price Gaps — In the Forex market, price gaps are most often seen at the start of the trading week. This is because the foreign exchange market is open 24 hours a day, 5 days a week. Chart Patterns — Classical chart patterns such as rectangles , triangles, pennants , and flags are still some of the most reliable formations that FX and CFD swing traders use.

In addition to classical chart patterns, there are other chart patterns based on harmonic Fibonacci relationships. These include the Gartley pattern, Bat pattern, Crab pattern, and Butterfly pattern to name just a few.

Below is an example of a rectangle chart pattern. In this section, we will describe a swing trade strategy that incorporates a very specific chart pattern. The formation that I referring to is the Bat pattern.

The Bat pattern is a pattern within the harmonic family of patterns. It is a reversal pattern that is often seen within the Forex market. It is a particularly reliable set up when it occurs on a major currency pair or cross currency pair. The Bat pattern consists of four distinct legs labeled the XA leg, AB leg, BC leg, and the CD leg. The extreme of point C should be contained within the extreme of point A.

Although there are other Fibonacci relationships as well that exist within this pattern, these are the major requirements of the Bat pattern formation. The expectation is once the price reaches the D point of the structure, there should be a reversal in the market.

More specifically, in the case of a bearish Bat pattern, prices should trade up to the D point and reverse from there. So what happened? We turned a winning trade into a possible non-winning trade.

In the end, math could not be in our favor so we might lose more than we win. Turning winning trades into non-winning trades can be a big disadvantage that we need to learn to avoid. But if we understand the concept of a long game and if we are disciplined, we might understand the value we are losing every time we act adventurous. One more approach that we might consider should be to use market orders, it means when we like some price where it stands we are going to tell our market broker to put us in.

We recommend market orders as an option to trade if you are not into price levels methods, you have nothing to wait for, just pull the trigger and wait for tomorrow.

If we trade this way we could potentially get all our value back. If the price does not hit our limit order by the same time the next day we should get rid of it or we can set it to cancel by itself on some platforms using the GTD order. What we want to develop here is the discipline of not taking some trades that are 20,30 or more pips worse than it should have been. We need to build our systems thoroughly and we need to let them work for us.

Because of this you guys should make an effort and try to trade in a more friendly time frame. Whichever route you chose to take we wish you all the best.

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A daily routine helps keep traders on task with the things they are supposed to be doing, instead of succumbing to distraction. A daily routine, along with a pre-trade checklist , aligns us with our trading plan —which is our written plan for entering, exiting, and managing trades. Whether day trading or swing trading, trading stocks or forex, the daily routine should be realistic, and work our trading plan into it. While a trading plan may tell us how to enter a trade, the daily routine details how we find and stalk that trade, from beginning to end, over and over.

The daily routine is also used to help reduce trading mistakes and work on problem areas. Here are some examples of daily swing trading and day trading routines for stocks and forex. As mentioned, your daily routine should be realistic for your own time constraints and tailored to your strategies.

I have included times for demonstration purposes, but you would of course put in the times that work for you. Move from one activity to the next with fluidity. If your times are not accurate for the task, you will either not be able to finish everything you need to, or if you have too much time between tasks you may get distracted by other things. During your trading time, focus on trading. If you need to do those things, schedule a few minutes for them.

Focus on what is in the routine, only at the time it is scheduled for. Depending on how busy my life is at given times, or my preference, I sometimes look for swing trades in the morning, and at other times I day trade forex in the morning. Reinforce that it is my trading time right now. Other tasks can wait until the designated times in the routine, or until free time. I also like to reinforce that I have no expectations for today , except to follow my plan and take what the market offers.

This is a commonly skipped step, but is very important for developing consistency. Consciously note each specification for an entry, and how the patterns you trade or criteria you trade look. Review each strategy type you are looking for, and why you trade ONLY those patterns. Even though you know your trading plan, do this step every day. Visualize a trade for each strategy in your plan, seeing it through to completion win and loss. Read it with conviction and intention and awareness.

Consciously note each task. Say each one, and the process and time you will give it. Even though you know your routine, do this step every day. Flag possible trades or write them down, then KEEP GOING through the entire list of forex pairs. Check for trade setup on lower time frames. Go through ALL flagged trades before placing a trade. This assures you know all the pairs that will be on your radar today, and at what levels.

You can also compare each trade to the other potential trades, finding the best ones considering reward:risk , etc. Check correlation if considering more than one pair.

Avoid multiple pairs that are highly correlated. Choose between them or split one position size between the highly correlated trades. No need to think much here. The work and analysis should already be done. Place the pairs you need to watch on those charts. Draw in the area and direction you want to trade, so that at a glance you can see if the trade triggers…this probably means having the charts set to the timeframe where you receive your trading triggers from.

Work out how you will monitor these trades. You may want to set alerts on your charting platform to let you know when a trade is approaching a trade level if possible. If you have other obligations, schedule a time to come back and check on these trades.

Your trading plan should already have all these answers in it! TIME : A specified time of day to check on the trades that were close to setting up. Also, stipulate if you are NOT going to check trades after or before a certain time. Did the routine get followed? If yes, congratulate yourself! If not, write down why.

Then move on two, then three, then the whole routine, gradually. Was the trading plan followed? What were the successes and failures? Note how this could be improved. These positively reinforce change when it comes to common trading mistakes. Some examples are below, but any statements you meditate on should be based on your own trading. I follow my trading plan, and my routine and checklist help me do it.

Sunday 3 PM : Review trades from prior week. Note mistakes and things done well. Make sure trade logs are up to date, and trades have been screenshotted and saved or printed. REAFFIRM THE EXIT STRATEGY IN EACH TRADE THAT IS OPEN. IF YOU ARE A DAY TRADER, CHECK OUT THE 5-minute pre-trade routine. It is a good start to a daily routine, then you just have to add in when you will do your reviews, and what you do before and after trading.

I also look for stock swing trades in the evening, so I have a routine for that. M y method for swing trading stocks is covered in the Complete Method Stock Swing Trading Course. Remove excitement, doubt, anger, optimism, pessimism…I want to get to where I feel neutral. That way emotions are less likely to affect my judgment. If angry, then everything is an opportunity for revenge.

Depressed or sad, nothing may look worthwhile. Are conditions favorable for taking trades? If yes, or close, then scan. If conditions are unfavorable, then go do something else or spend the time reviewing prior trades or working on other strategies. Start scanning for patterns; adjusting scan criteria for current market conditions. If I have lots of time this evening, relax the criteria slightly to allow for a larger list. If I have time constraints, then tighten the criteria so there are fewer stocks to go through zero-in on higher performance parameters.

Write down all stocks that look close to fitting the parameters of a trade, or that are close could fully set up prior to my next scan. Go through all stocks before analyzing any single one closely or putting out orders.

Every trade should look ideal, because an ideal trade means it meets all the strategy parameters. Note how much capital I have available for trades, and then I know the maximum number of trades I can take based on position size. Stocks with orders and live trades are placed on my live trades watchlist in TradingView watchlist 8 per layout, and I have multiple layouts open in multiple browser tabs , with the order levels marked.

If the stock is no longer looking like it will setup, remove it from the watchlist. THIS IS USEFUL TO DO EVERY DAY YOU HAVE TRADES OPEN. The trading plan should already have all these answers in it! See examples in the Forex routine above.

Sunday 3 PM : Review trades from the prior week. Make sure the trade log is up to date, and trades have been screenshotted and saved or printed. Make your own daily trading routines. Spend a few hours and come up with how your trading day looks. Be realistic, and accommodate your strengths and weaknesses. Tweak the above daily routine as needed. Specify what your review process is after trading ends, and set limits on when you will look for and take trades. The daily debrief is also very important.

My daily routine took me several hours to think about and figure out and some days I day trade, others I swing trade, so I have routines for all of them.

I had to take my life into account, as well as my personality, and my trading plan. A customized routine is well-thought-out and helps you stay focused on executing your trading plan and eliminating mistakes. My routine gets tweaked from time to time as life changes or I notice certain changes in my trading. Review the routine once a month to make sure it still fits your lifestyle and your trading plan.

The EURUSD Day Trading Course covers how I day trade forex in less 2 hours each day. The Complete Method Stock Swing Trading Course covers how I swing trade in about hours per week can adjust based on how often you scan for trades. D isclaimer: Nothing in this article is personal investment advice, or advice to buy or sell anything.

Trading is risky and can result in substantial losses, even more than deposited if using leverage. Cory is a professional trader since

They provide a great foundation for trading swings in the market and offer some of the best target areas. Disadvantages of Swing Trading. kelchi says join my telegram channel for free price action trade setups Reply. In the conventional sense, a swing trader is said to hold onto a position for several days up to several weeks. Cory Mitchell, CMT · Reply. Get a slightly out of the money strike. This is the only time you have a completely neutral bias.

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