Swing Trading For Dummies

Increase profit and limit risk with swing trading basics

Swing trading is all about riding the momentum of brief price changes in trending stocks. Although it can be risky, swing trading is popular for a reason, and Swing Trading For Dummies, 2nd Edition, will show you how to manage the risk and navigate the latest markets to succeed at this lucrative trading strategy.

In this updated edition, you’ll find expert guidance on new accounting rules, the 2018 tax law, trading in international markets, algorithmic trading, and more. Plus, learn about the role social media now plays in moving asset prices, and how you can tap into online trends to ride price swings.

• Understand money management, journal keeping, and strategy planning
• Focus on fundamental analysis to increase your chance of success
• Evaluate companies to screen for under- or overvalued stocks
• Develop and implement your trading plan and calculate performance

Starting from the basic differences between swing trading and other trading styles and progressing through plain-English explanations of more advanced topics like charts and reporting standards, Swing Trading For Dummies will help you maintain and grow your assets with swing trading in any market!

Introduction 1

About This Book 2

Foolish Assumptions 3

Icons Used in This Book 3

Where to Go from Here 4

Part 1: Getting into the Swing of Things 5

Chapter 1: Swing Trading from A to Z 7

Understanding What Swing Trading is (and Isn’t) 8

The differences between swing trading and buy-and-hold investing 8

The differences between swing trading and day trading 11

What Swing Trading is to You: Determining Your Time Commitment 12

Swing trading as your primary source of income 12

Swing trading to supplement income or improve investment returns 13

Swing trading just for fun 14

Sneaking a Peek at the Swing Trader’s Strategic Plan 14

The “what”: Determining which securities you’ll trade 15

More “what”: Trading stocks consistent with your values 17

The “where”: Deciding where you’ll trade 18

The “when” and the “how”: Choosing your trading style and strategy 19

Building Your Swing Trading Prowess 24

Chapter 2: Understanding the Swing Trader’s Two Main Strategies 25

Strategy and Style: The Swing Trader’s Bio 26

Two forms of analysis, head to head 26

Scope approach: Top down or bottom up? 29

Styles of trading: Discretionary versus Quantitative 29

Wrapping Your Mind around Technical Theory 30

Understanding how and why technical analysis works 31

Sizing up the technical advantages and disadvantages 33

The two main approaches of technical analysis 34

Appreciating the Value of the Big Picture: Fundamental Theory 37

Understanding how and why fundamental analysis works 37

Surveying the fundamental advantages and disadvantages 39

Looking at catalysts and the great growth/value divide 40

Chapter 3: Focusing on the Small Stuff: The Administrative Tasks 45

Hooking Up with a Broker 46

Choosing a broker 46

Opening an account 49

Selecting Service Providers 50

Providers to do business with 51

Providers to avoid 55

Starting a Trading Journal 57

Creating a Winning Mindset 59

Part 2: Timing is Everything: Technical Analysis 61

Chapter 4: Charting the Market 63

Nailing Down the Concepts: The Roles of Price and Volume in Charting 64

Having Fun with Pictures: The Four Main Chart Types 65

Charts in Action: A Pictorial View of the Security Cycle of Life 68

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