10 Simple Swing Trading Tips to Help You Trade Better

Whether you’re just starting or want to become a better swing trader, these 10 simple swing trading tips can help you develop your own swing trade strategy.

This post may contain affiliate links, which means we may earn a commission if you make a purchase. As an Amazon Associate we earn from qualifying purchases. Thank you for your support!

Swing trading can be confusing at first to the beginner. Fortunately, it’s not nearly as complex as it may seem. Whether you are just starting out, or you want to learn how to become a better swing trader, these 10 simple swing trading tips will help you develop your own swing trading strategy that works best for you.

Here are 10 Simple Swing Trading Tips:


#1: Choose The Right Brokerage Account

This tip is one of the most important, and it’s one many “gurus” fail to tell you about in the beginning. You absolutely MUST make sure you have the right brokerage account. I know many traders who have lost money just from having the wrong broker for their investment strategies alone.

Don’t just go with the first one you see or know about.  You can lose a great deal of money if you choose the wrong one.  Take the extra time to find the right one.  Trading fees add up over time.  There are plenty of great brokers out there.  Find the one that best suits your needs.

{See our article: Choosing The Best Online Broker}

#2: Be Aware of External Forces

The stock market has a number of external factors which can always influence the future of a stock price. These factors can include anything: an entire stock market crash, stock manipulation, new company management, new company products, good or bad press news, natural disasters, slow or heavy trade seasons, and a number of other things you may never even see coming.

Before investing in a particular stock, you will want to do as much research about a company as possible, as well as research the overall market and how it is performing in any given time frame. Read press releases, stay on top of industry news, and always be aware that external forces can influence the overall stock price and performance.

#3: When Swing Trading, Let Time Be On Your Side

The beauty of swing trading is that there is no specific time frame in which you hold a stock. You can hold onto your shares for as little or as long as you need to until you feel you have reached your specific goals.

Unlike day trading, you can hold a stock and never need to sell it on a day where the stock price is performing poorly. You do not need to ever feel pressured to sell. There are times when you may feel a stock is only going to continue on a downward trend and you may be best off to take a small loss – but for the most part you can ride the waves of stock prices until you are ready to sell.

#4: Never Rely on a Single Stock Indicator

There are a number of indicators you can look at when forecasting the movement of a stock. These for example may include volume, prices, time frames, etc. Volume alone is not enough to make a decision on whether to purchase a stock. Neither are prices. It’s also important that you analyze different time frames, such as a 3 month chart, 6 month chart, 5 year chart, etc.

It is when you combine this data together that you can formulate you own swing trading tactics and strategies. Combining multiple factors together simply gives you more tools to work with and increases your ability to reach your income goals.

#5: Pay Attention to Unusual Volume {even though others may tell you it doesn’t matter}

Volume is a measurement of how many shares are being traded. Keep in mind that volume does not necessarily mean a lot of traders interested in a stock, it can also mean that a large investment firm has purchased a huge number of shares in smaller blocks. This is why volume should never be used as a stand alone factor in deciding on whether or not to invest in a stock.

There seems to be a lot of controversy on whether volume matters when choosing stocks to swing trade. Some will tell you it doesn’t have any importance whatsoever. However, in my own experience, volume can be an indicator for several things which will influence whether or not the stock is a smart investment.

You will want to pay the most attention to stocks that have unusual volume.  To find them do a search on “Nasdaq Unusual Volume”.  You will find a list of stocks.  Don’t buy any right away. Just keep your eyes on them, research them and try to find out why more shares are suddenly being traded.

#6: Price Action Alone is Not Enough!

As said before, you need to combine data together in order to formulate your strategies for swing trading.

When you start to notice prices moving up or down in a pattern this price action can start to make you very excited about a stock. However, one swing trading tip I have learned is to take into account price action in conjunction with unusual volume.

Think of it like this: Price action is simply one tool you can use – if you combine it with volume you are empowering yourself with more knowledge and information.

#7: Understand What Volume + Price Together May Indicate

By combining volume data with price action data, you can look for a number of trends in the stock chart.  Price Action and Volume together can potentially signify a change and reversal point in the stock price, which could make a stock a good choice for swing trading.

Here are 4 things to look for:

  • If you notice unusual volume and the stock prices are going up and the volume is going up the prices might continue to rise as well.  Make a note of it and watch to see if this actually happens.
  • If you notice unusual volume and the stock prices are going up and the volume is decreasing the prices might either increase at a slower rate or start to fall.  Again you should just be researching at this point and taking notes for future trades.
  • If you notice unusual volume and the stock prices are going down and the volume is going up the prices might fall further.  Again, for now just pay attention to this and start planning your own strategy.
  • If you notice unusual volume and the stock prices are going down and the volume is also going down the prices sometimes slow down or they will start to increase which could indicate a reversal.  Compare this with some chart analysis such as candlestick chart patterns.  Again record the data in a journal and plan your own strategy.

#8: Keep a Trade Journal or Use Software to Manage Your Data

Keeping track of all your data can be complicated. One of the most simple ways to keep track of things is through a simple pen and notebook. If you are more tech-inclined, you may wish to keep a spreadsheet of this data, or use stock trading software which can help you identify trends and organize your data.

While this may seem silly to do, it’s actually quite beneficial because we can only remember and use so much data at once. Think of it like this: You go to the store and create a shopping list to make sure you don’t forget anything. Keeping a stock trade journal or organizing your notes and data in software for stock analysis will definitely keep you on top of things and make sure you don’t accidentally overlook the obvious.

Be sure you also record what went right, what went wrong and what you might do differently next time.

#9: Start Small and Don’t Try to Become a Millionaire Over Night

It’s very important if you are a beginner that you start on a small scale. After you do your research and are confident in buying a stock, decide how much risk you are willing to take and what percent of your portfolio you want each trade to be.

It’s also important that you don’t try to get rich over night or in a short time frame. While you may hear people claiming this is all possible, if you are a new trader, you are far more likely to lose money than make any money. So start with a small investment until your confidence and ability grow and you are a more experienced trader.

If risk is a concern to you, you may want to pay attention to industry trends and patterns and consider swing trading ETF’s since they tend to be less risky than individual stocks.

#10: Be Wary of ANYONE Who Tells You What to Trade or Promises “Education”…

There are sadly a number of scams and people out there who want to take advantage of you at a hefty price for their own benefit. Some of these “classes” and “stock courses” are nothing more than a self proclaimed guru acting as a ringleader telling you what to buy and when to buy it and sell it, which can ultimately manipulate prices in their own favor and leave you hung out to dry losing money.

Also, keep in mind true education should typically be done through an accredited source, such as taking local courses at your Community College or through another accredited university.

You need to learn how to develop your own stock market strategies and most importantly rely on your own intuition and research. Do not ever let someone else influence your decision to buy a stock, because there is no way for you to truly evaluate their research method, their strategy, or their ulterior motives.

We hope that these swing trading stock tips will help you avoid making costly mistakes and to help you get started in swing trading as a beginner. There is no “fool-proof” method for investing in the stock market, but with this knowledge and these 10 simple tips hopefully you will be able to understand your risks as a beginner investor and gain some important experience which will ultimately help you become a better swing trader over time.

Any questions? Comments? Share your thoughts below!

Leave a Reply

Your email address will not be published. Required fields are marked *