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What is Swing Trading? How Does it Differ From Day Trading?

In order to explain what swing trading is, it makes sense to first explain the most active form of trading – day trading.

What is Swing Trading Explained in Detail

In comparison to swing trading, day trading is a much more popular term that most people have heard of. It involves buying and selling positions within the same day, sometimes within the same hour or minute. Almost exclusively, day traders are looking for momentum, and not concerning themselves with fundamental analysis. The goal is to capture profits quickly, so the hunt is on for opportunities with massive volume and volatility. Day trades can be pinpointed and executed in a flash, without the risk of overnight holds.

Swing trading is closely linked to day trading, but offers more leeway for less active traders. It can be a short-term to medium-term trading style depending on individual trade setups and trader preferences, with hold times ranging anywhere from a couple days to a few weeks, or even several months. The main advantage to swing trading is that it is much more flexible than day trading. So for individuals that don’t have the availability during market hours to monitor the market tick-by-tick, it can be a more realistic option.

In essence, swing trading covers the vast middle ground between active day trading and passive long-term investing. In my experience, however, swing trading typically falls closer to the short-term category than medium or long-term.

Why Day Trading and Swing Trading Are So Closely Related:

There are many times when day trading and swing trading can overlap. For example, a day trader might enter a trade with the initial plan of closing it out within the same day, but then decide to hold part or all of their position overnight, thus turning it into a swing trade. There are also times when a swing trader might enter a position planning to hold for a few days or weeks, but then it hits their profit target within the same day, so they close out the position earlier than expected, turning it into a day trade.

Day Trading vs Swing Trading

Blurred Lines Between Day Trading and Swing Trading

The point is: day trading and swing trading aren’t always clearly delineated. Most day traders are also swing traders and many swing traders are also day traders. Depending on personal schedules and preferences, current market conditions, and where traders deem the best opportunities to be right now – these factors can play a role in dictating where they presently fall on the day trading/swing trading spectrum. If you have had experiences with any day trading or swing trading educational services in the past, then you probably know that most cover both. That’s because the basic price action and other technical analysis concepts apply in both cases.

The longer the hold times, the more important fundamental analysis becomes. This is why day traders are solely concerned with trends, support and resistance areas, indicators, and other forms of technical analysis, while investors are solely concerned with income statements, balance sheets, financial ratios, and other forms of fundamental analysis. Swing traders fall somewhere in the middle, sometimes using aspects of both. Overall, the longer you hold a position, the more intrinsic value you want it to have in order to protect your downside. Many securities that day traders target aren’t fundamentally strong, but present short-term opportunities of volatility.

Advantages and Disadvantages of Swing Trading:

The biggest advantage of swing trading is the flexibility it can provide. Depending on personal availability during market hours, risk tolerance, and overall preferences, you can develop a customized swing trading strategy with specific setups, hold times, and profit potential that best fits your own lifestyle. For skilled traders, day trading offers the most profit potential, but having to actively monitor the market on a tick-by-tick basis is out of reach for most people. Certain schedules simply don’t permit this level of supervision.

  • Longer Hold Times
  • Flexible Entries and Exits
  • Don’t Need to Monitor Positions Tick-By-Tick
  • Less Active Than Day Trading
  • Overnight Market Exposure (Could Be Good or Bad)
  • Lower Profit Potential in Comparison to Day Trading

But swing trading can potentially work for busy individuals with full-time jobs who might only be able to check on opportunities and manage open positions a few times per day. Of course, everybody’s circumstances, preferences, and willingness to put time, effort, and resources into the market will be different, so it all comes down to identifying a trading style that works for you. Since swing trading covers such a large gap between day trading and investing, it’s a fairly popular approach for new market participants.

Some people don’t actively trade at all. Some people don’t even passively invest. But others day trade, swing trade, and invest. There’s no one forcing or limiting you from any of these options. Ultimately, your trading and investing choices are completely up to you.

Best Day Trading and Swing Trading Alert Services:

Day and swing trading alert services are a classic trap for new, naive traders just getting started on their journeys. This is a warning not to get pulled down that path. It’s extremely easy to fall for promises of “foolproof systems” and “explosive profits”, but these services won’t work like you expect. Trust me, I know from personal experience that trying to blindly copy somebody else’s short-term trade alerts won’t produce consistent profits. It’s a shortcut that sounds great, but isn’t really a shortcut at all. It’s just a recipe for disaster.

Best Penny Stock Newsletter and Alert Service Review

There are numerous reasons why alert services are dangerous and ineffective. The main reason is that the reliance on alerts handicaps people from actually building the core skills required to become consistently profitable. Subscribers think they can just follow some self-proclaimed guru’s alerts in order to achieve trading success, but it never works as expected. Entry and exit prices are rarely, if ever, the same. And in many cases, subscribers don’t even have any risk management measures in place. They tend to use huge position sizes, add to losing positions, display all kinds of irrational behavior, and then end up taking gigantic, painful losses.

In other words, most subscribers have no idea what they’re doing. They think that following “buy” and “sell” alerts will produce quick and easy profits, but it rarely ends up working that way. The majority of alert followers actually lose money instead. What if you follow a buy alert and then miss the sell alert? Do you have your own plan for managing your exit? Do you even understand the reasons for being in the trade to begin with? What are the main support and resistance levels? Is there a catalyst? Are you using an appropriate position size? What’s your risk vs. reward? The bottom line is that you can’t cheat the market. You have to become self-sufficient.

Best Day Trading and Swing Trading Mentorship Services: 

The difference between alert services and mentorship services is that mentorship services actually offer the education and coaching necessary for students to become self-sufficient consistently profitable traders. The tricky part is that many alert services also offer mentorship services. A general rule is that if a trading service is solely an alert service, offering no additional insights or mentorship as to why specific trades are being alerted, then that service is almost certainly a scam.

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If, however, a service offers a handful of educational content, such as high-quality video lessons and courses, helpful chat rooms, detailed daily watch lists, live trading sessions, weekly or monthly webinars, and other forms of ongoing mentorship, then there’s a chance that the service can actually help you become a successful trader – if used correctly. I say this because even though all of these educational tools are available, most members still choose to bypass them and opt for the perilous path of blindly copying alerts.


The thing is: alerts by themselves aren’t entirely bad. In theory, alerts can prove that the leaders of these services are actually implementing the methods that they teach, and that those methods actually work. They can provide a level of transparency that some trading services don’t. And they can allow members to see what kind of trades the leader is taking and then study the underlying reasons why. But all of these advantages of alerts get wiped out by the masses of copy-cat followers who end up distorting results.

It then becomes hard to tell if their methods actually work, or if they only work with thousands of blind followers piling in behind them.

Conclusion – Is Taking Part in Day Trading or Swing Trading a Bad Idea?

I don’t think day trading and swing trading are bad ideas if you’re willing to commit time, energy, and resources to becoming consistently profitable. The potential rewards from trading can be immense if the proper path is taken. That path involves building the necessary tactical and mental skills with mentorship from Trade With Profile, for example. Unfortunately, most people skip this step because they’re attracted to the quick and easy path of “hot stock alerts”. They choose the path of huge rewards for minimal effort. Ironically, these enticing shortcuts actually become the longer, harder, and more expensive routes.

trading mindset quote from trading in the zone by mark douglas

There’s no doubt that the way most people initially approach trading – without the proper skills and mindset – is definitely a bad idea. These people are essentially gambling. They’re in the market just for thrills – trying to boost their ego or status. There’s nobody stopping you from doing that. But that’s not good trading. That’s not how consistent success in the market is achieved. Much like becoming a top-level musician or athlete, trading is a skill-based peak performance endeavor. It can sometimes be hard to see that with most market participants acting randomly and impulsively, but it requires specific tactical and mental skills.

Over 90% of traders fail because the barriers to entry are low and they have no real idea of what it takes to succeed long-term.

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Written by Matt Thomas (@MattThomasTP)

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Matt Thomas

Founder of, Creator of the Trading Success Framework Course & Trading Paradigm Skool Community, and Intraday Futures Trader Using Auction Market Theory & Profiling (Volume & Market Profile).

One Comment

  • Beth Wiens says:

    Thanks for making this so clear. By comparing swing trading with day trading, you made it very easy to see the differences between them but also how they overlap. I also appreciate the clear ‘pro,’ and ‘con,’ list as well. It’s nice to see someone explain these methods in a way that is so easy to understand.

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