Forex Swing Trading

Swing trading is not as clearly defined concepts, but there are different interpretations of the approach. With "swing" the momentum of the market is meant to exploit it applies to the trader. Swing trading is short-term orientation and position in the market are usually not kept for longer than a week.

A common interpretation of swing trading that attempts by market movements, which are directed against the actual trend is to benefit. A trader looking in an upward trend, according to phases, where the market is overbought and is expected to be a short term correction. Conversely, one sought in a downtrend intact oversold situation, followed by an upward correction.

Another interpretation of swing trading seen as focusing on important support and resistance zones on the market. It is in a market that is approaching the resistance, first a short position is opened with the aim to profit from the rebound of the price down. Is then broken and the resistance continues to rise, the market, the position and turned from the counter-cyclical investment is a procyclical. The limit to an outbreak strategy is fluent in this interpretation.

Swing trading systems are described in terms of their risk-reward profile as varied as the number of interpretations that swing trading. If a model is selected, at the positions opened primarily to support or resistance around the earnings profile depends on the filter that comes with the signal generation for use: If you are trading any support and any resistance will get quite a lot of false signals. Who opened only rarely and in the presence of strict criteria, a position likely to have expected a better performance in the long run.