Swing trading is a style of trading that attempts to capture gains in a stock or any financial
instrument over a period of a few days to several weeks. Swing traders
primarily use technical analysis to look for trading opportunities. These
traders may utilize fundamental analysis in addition to analyzing price trends
and patterns.

Understanding Swing Trading

This type of trading requires patience to hold your trades
for several days at a time. Swing trading stands in contrast to day trading,
where positions are entered and exited within the same trading day. Swing traders take on overnight risk, and they also need to be mindful of
possible market gaps that could cause significant losses or profits when they
are not actively watching the markets.

Keys to Successful Swing Trading:

• Identify Trade Candidates: Successful swing trading starts with identifying the
  potential trade. Look for stocks that exhibit short-term price momentum or
  patterns like flags, pennants, or head and shoulders.
• Technical Analysis: Utilize charts and various technical indicators such
  as moving averages, MACD (Moving Average Convergence Divergence), RSI
  (Relative Strength Index), and Bollinger Bands to determine optimal entry
  and exit points.
• Risk Management: It’s vital to establish clear stop-loss orders to
  limit potential losses if the market moves against your position.
  Similarly, it’s wise to have profit targets to secure gains.
• Stay Updated with Market News: Even though swing trading is mostly based on technical
  analysis, staying informed about key economic events and earnings reports
  can be beneficial. This kind of news can lead to market movements that
  either align with your trading strategy or require you to adapt your
  approach.
• Have a Plan and Stick to It: Discipline is key. Develop a trading plan with defined
  rules for trade entries, exits, and money management — and stick to it
  meticulously.
• Keep Emotions in Check: Emotional decision-making can lead to mistakes. Trust
  your strategy, and don’t let fear or greed dictate your actions.
• Review Your Trades Regularly: Analyzing what worked, what didn’t, and why is
  essential for improving as a swing trader. Make regular reviews part of
  your routine.

Tips for Swing Trading

1. Start Small: When you’re new to swing trading, begin with smaller
   trades to get a feel for the market dynamics without taking on too much
   risk.
2. Choose Liquid Stocks: Trading in liquid stocks allows for easier entry and
   exit, reducing the risk of slippage – which is the difference between the
   expected price of a trade and the actual price at which the trade is
   executed.
3. Watch Multiple Time Frames: While swing traders typically operate on daily charts,
   looking at longer time frames can offer a better perspective on the
   overarching trend and support/resistance levels.
4. Utilize Paper Trading: Test strategies through paper trading before putting
   real money on the line. This allows you to hone your skills without
   financial risk.
5. Stay Organized: Keep an organized record of all your trades, including
   your rationale for entering and exiting them. This log will be valuable
   for learning and adjustment purposes.
6. Manage Capital Wisely: Don’t allocate more than a certain percentage of your
   portfolio to a single trade. This can help manage risk and keep you from
   being overly exposed to any single position.
7. Continuous Learning: The markets are always changing, so continuous
   education is crucial. Stay updated with trading books, online courses,
   webinars, and active trading communities.

Remember, no single strategy guarantees success in trading,
but swing trading can be profitable if approached with discipline, knowledge,
and a strong risk management framework.

This article was written by FL Contributors at www.forexlive.com.

• Wage growth, services inflation are twice the rate consistent with sustainable CPI
• But reasonably confident that wage growth will edge down further in coming months
• Expectation in wage growth fall is due to fall in headline inflation

Don’t expect to get much of a change to this narrative until we are right at the point where rate cuts are to present themselves. In the case of the BOE, it might only come around May.

This article was written by Justin Low at www.forexlive.com.

With the dollar sagging slightly today, gold is finding reason to cheer on the rebound from last week. The precious metal is up another 0.4% today to $2,026 as it has now erased its post-CPI drop.

The rebound comes as buyers defended the 100-day moving average (red line) last week, before breaking back above $2,000. And the run higher has since gathered pace with gold now just down 0.6% on the month.

The volatile action in gold to start the year is a reflection of the big swings in market odds on central bank rate cuts pricing. And as things are settling down now a little with traders readjusting, gold is still finding itself supported.

I’d argue that bodes well for the precious metal in the bigger picture. However, there could be some lingering concerns from a technical standpoint.

The rebound off the 100-day moving average has been a textbook trade for chartists. But there is a potential pattern forming which is showing lower highs and lower lows. That could come back to bite at gold for a bit before we can really talk about a major breakout to $2,100 and beyond again.

For now, the upside momentum might be capped closer to the trendline resistance near $2,053.

This article was written by Justin Low at www.forexlive.com.

• There has been a lot of emphasis on UK recession rather than strong story on employment

For now, their current policy stance is to stay on hold. As such, they will put out whatever narrative to support that. You can’t fault Bailey for trying to sell this side of the story, but the latest UK labour market report does come with a big caveat as highlighted in the report here at the time.

This article was written by Justin Low at www.forexlive.com.

EUR/USD is up 0.2% to 1.0800, keeping relatively unfazed by the ECB wages data earlier here. Overall, the dollar is down slightly across the board alongside lower Treasury yields to start the day. 10-year yields are down 2.4 bps to 4.271%, keeping limited below its 100-day moving average:

I would argue that is playing a role in keeping the dollar in check for the time being.

USD/JPY is back down to near flat levels around 150.17, after having touched a high of 150.43 in Asia trading. Meanwhile, the antipodean currencies are pushing to session highs right now despite a lack of risk enthusiasm. AUD/USD is up 0.3% to 0.6558 and contesting its 100-day moving average of 0.6541 while NZD/USD is up 0.3% to 0.6168 and contesting daily resistance around 0.6150-73 – both highlighted here earlier.

In other markets, gold is also up another 0.4% to $2,026 as the rebound continues while stocks are struggling with S&P 500 futures now down 0.4% on the day.

This article was written by Justin Low at www.forexlive.com.