Bitcoin Trading: Swing-Trading Strategies You Can Use To Your Advantage

If you’re a beginner and find it hard to keep up with the market prices or have a full-time job that leaves you little time to trade, Bitcoin swing trading may be the way to go.

As a swing trader, you hold a trade for a few days or weeks and make money from short- and medium-term price changes and market swings.

When trading using this strategy, you focus more on the hourly and daily price charts while at the same time paying attention to the 4-hour to 24-hour charts to see how the market is moving and then switch to lower timeframes to get the best pricing and entry areas. 

The daily chart is also handy for summarizing how prices have changed during the day. 

To win in swing trading, you need to have a strategy. Luckily, there are many of them you can go for. They include: 

Trend trading

Just like its name, this strategy involves trading the trend. In this strategy, you look for a trend in the market and try to ride one big move.

A great way to imagine this strategy is to imagine a surfer finding a wave and paddling in the same direction. The surfer rides the wave before jumping off before it collapses.

One way to trade using this strategy is to use the 50-day moving average to figure out whether a market is going up or down. As soon as the coin goes over the moving average, you buy.

 Most of the time, this breakout is followed by more people wanting to buy, which leads to a sudden spike in price, which makes you money. 

Remember that you should look at different time frames when trading this strategy. You should try to catch the daily trend price and, at the same time, zoom out and catch the weekly trend. 

Buying the pullback

This is a great strategy if you missed the first breakout. 

Most of the time, a coin’s price will go up after a breakout, but at some time, traders will start to cash in on their gains. This causes the price to drop quickly, and you can capitalize on this. If you missed the breakout the first time, this sharp pullback gives you another chance to buy Bitcoin.

Remember that when trading the breakout, you should always follow your strategy and not allow noise and emotions to get in the way. Also, always wait for confirmation that you are dealing with a breakout so you don’t lose money. 

Trading reversals

Also known as following the crowd, this strategy involves finding the levels of support and resistance for the coin over a certain period. This may be a day, a week, two weeks, or anything else.

If you are new to trading, the resistance level is the price at which a coin won’t go up anymore. The support level, on the other hand, is the price at which the currency will fall back before changing direction.

The pricing of a coin works like lanes with the bumpers up. The coin’s price will fluctuate between the resistance and support levels. Remember that these values could go up, down, or stay the same over time.

Once you have identified these levels, all you have to do is follow the pattern. When the currency gets close to the higher resistance level, you either take your profits or go short. 

When the coin reaches the resistance levels, you expect it to turn around. You should trade the reversal and wait for the coin to reach the bottom support level before cashing out. 

Swing trading best practices

Besides paying attention to the various time flames and entering at the right times, you should also pay attention to the fundamentals. This calls for you to pay attention to what’s happening in the news and what people think about the coin at a certain time.

From this, you will tell how the market feels about your Bitcoin asset and its short-, medium-, and long-term potential.

It’s also wise to use technical indicators and tools to learn more about the market, what has been traded in the past, and key price points. This will help you predict the market and whether it’s wise to enter it. 

How do you get started with Bitcoin swing trading?

To start swing trading, you must open a trading account with a reliable exchange such as Bitcoineer. When choosing a Bitcoin exchange, look for things like live support, ease of use, low transaction fees, and other vital aspects.

It’s also wise to check reviews to see what others recommend. 

If you have never traded before, learn how to trade first. Thankfully, you can take advantage of plenty of free resources. There are videos, books, and even mentors that you can use to your advantage. 

Before trading with real money, start with paper trading until you develop a strategy that works and you have proven that you can trust it. 

Even when you are confident that you can trade with real money, don’t start with a lot of it, as you can easily lose it. Instead, you should start with a small quantity of money and grow from there. 

Of course, you should never trade with money you can’t afford to lose. This means you should never trade with your rent, loan, or other vital money. This is because you tend to involve too many emotions that cloud your judgment, which increases your chances of making mistakes and entering the wrong trades that see you losing money. 

Parting shot

Swing trading is the perfect strategy for you if you are busy and don’t have time to monitor the bitcoin prices at all times. While this is the case, remember to be patient because you won’t discover ideal trade setups as regularly as day traders do. So, you must stay calm while waiting for a trade to set up.

To stay safe, never take a trade that doesn’t align with your plan.