Understanding Crypto Swing Trading and Proven Tips

Understanding crypto swing trading and proven tips to follow is quite important. Most of the crypto traders favor swing trading irrespective of their experience level.

The timescale, the volatility as well as the rate of return are the primary causes of its popularity and preference over other forms of crypto trading.

Swing trading is a specific crypto trading strategy in which traders intend to make profits due to the movements in the price of a particular crypto coin over a specific period of time, typically for a day or a week at the most.

Ideally, there are two specific types of crypto swing trading that the traders look for. These are:

  • Swing highs – This is when the crypto market peaks ahead of pulling back. It is good for making a short trade.
  • Swing lows – This is when the market bounces and dips. This is good for making a long trade.

Therefore, as you can see swing trading strategies are good for trending markets. It includes stocks, forex, and cryptocurrencies.

If you are a beginner, it is best to try your hands out in swing trading using safer coins like Bitcoin, Tether, and Ethereum.

These coins usually have a higher market capitalization and are also quite volatile and highly traded.

Understanding Crypto Swing Trading and Proven Tips

Understanding Crypto Swing Trading and Proven Tips

However, being knowledgeable about swing trading before stepping into it will be a wise decision and it may even help you to avoid incurring some irrecoverable losses.

It is therefore paramount that you know about the basics and beyond. Check out Best Cryptocurrencies to Buy for Early Retirement.

In order to be successful in your crypto swing trading, you will need to use some typical tools for technical analysis as well.

This will help you to identify the daily and weekly price trends using the short and medium time frame charts, respectively.

Add to that, the different charts and bots will also help you significantly in being a successful crypto swing trader.

Apart from that, you must also make some more fundamental analysis to know about the economic events during that specific time period.

Remember, whether you trade with Bitcoin or other Altcoins, following the best practices and tips will enhance your swing trading strategies significantly.

It will allow you to overcome the challenges involved in it and offer a complete peace of mind. Here are a few proven tips to follow for more productive results.

Use the Social and Copy Trading Platforms

It is quite natural to look for a broker offering copy trading, especially if you are a novice in swing trading and want to see your specific coins in action.

There are several of these social and copy trading platforms such as eToro that will help you in your swing trading endeavor.

These platforms will allow sharing innovative ideas of swing crypto trading by others within the crypto community and copy several different profitable deals.

With such knowledge it will be easier for you to find a strong foothold into the crypto scene.

You may also look for copy trading providers as well. These are the professionals who have mastered the art of swing trading and are happy to educate people about some of the best strategies to follow in swing trading within the platform.

Use Some Relevant Tools

You will also be much better off when you use some of the best and widely used automation and signal tools for swing trading crypto.

The automated tools include those crypto trading signals and bots as well. If you follow these tools you will find it easy to expedite the process and complete a larger number of trades successfully.

One of the best ways to go ahead is by using trading robots, or bots, as these are called commonly.

The benefit of using a trading bot is that it will allow you to buy and sell crypto coins only when the predefined criteria for it have been met successfully. It does it automatically but only after scanning the market thoroughly.

You can choose from a large number and types of these trading robots available out there according to your specific swing trading strategy.

These can also be programmed according to your preferences and depending on the trading volume and time, orders and price of the coin.

Read Also:  Illicit Bitcoin Transactions: Analysis Techniques Explained

Another good way is to follow the crypto trading signals. There are a few specific trading platforms that come with a large number of signal providers. These signal providers can be automated or even managed by another trader.

The good thing about these trading signals is that all of these work pretty well with all types of swing trading crypto strategies.

These will be much more effective since these signals can work overnight when you leave your positions open.

Do Some Analysis

Doing some technical and fundamental analysis before you start trading your crypto coins is a much better idea.

There are lots of different and useful technical analysis tools that will help you to make your swing crypto trading a success.

These are specialized tools designed with the sole objective to identify and analyze any anomalies in the price movements of the crypto coins.

Based on these movements, a few technical analytical tools can also determine the candlestick chart patterns. This is done by taking several parameters into account such as:

  • The support level
  • The resistance level
  • RSI or Relative Strength Index
  • Trading volume
  • Bollinger Bands
  • Moving averages
  • Fibonacci Retracement and
  • Stochastic oscillator.

These tools also help a crypto swing trader to spot out the bullish and bearish movements and mark these zones precisely within a given chart.

Based on these zones, they can make a decision as to whether they should buy or sell the crypto coins in the market.

In short, the technical analysis will help you as a swing trader to make out the two distinct opportunities offered by the crypto market. These are:

  • Trends, which are the long-term movements of the market that are dependent on and described by the specific short-term oscillations and
  • Breakouts, which denote the commencement of a new or upcoming trend.

One of the most popular and widely used technical analysis tools by the crypto swing traders is the Moving Averages tool.

This particular tool will help you to evaluate the average of the price movement of any crypto asset over a certain period of time.

With the help of this tool you will be able to spot bullish or bearish movements if there is any crossover identified. In addition to that, this tool will also help you to use these means as the support or resistance level.

In addition to technical analysis, you should also do some fundamental analysis as well to know about the crucial aspects of crypto swing trading.

Though technical analysis is more favored by a swing trader, analyzing the fundamentals will not hurt.

Therefore, to be a successful swing trader and create a more effective crypto trading strategy you should not only go through the different charts, candlesticks, and indicators but should also look at different stats, price history, news, market events and financial reports.

This will keep you on top of everything and you will know the factors that can result in a price movement in the crypto market.

Focus on Risk Management

Since the crypto market is extremely volatile, risk management is very important while making a crypto swing trade.

Though the rule of thumb is not to invest more than you can afford to lose, using specific tools, once again, will ensure proper and precise management of the inherent risks of the trade once you are in it.

Setting stop-loss parameters is one of the best ways to mitigate the risks in swing crypto trading.

This is important because in this specific form of crypto trade you will often need to store your crypto coins in the digital wallet to hold your position overnight.

Typically, in swing crypto trading it is very important to ensure that your funds are safe and protected when you are not in front of your computer.

This will prevent your account from being wiped out entirely and make a reasonable amount of profit.

Though losses cannot be ruled out entirely, proper risk management will surely and significantly minimize the losses.

These small losses will be still manageable and recoverable by the gains made in the future.

Time Your Trade Well

If you want to be a successful crypto swing trader, you must time your trades correctly because it is all about timing.

You should strike the iron when it is hot and make the best of the price movements to make profits now and look for the next available opportunity to trade, if you miss out on one current opportunity.

In order to do that, you should have a clear plan so that you can achieve your crypto swing trading goals easily.

Therefore, create a proper plan even though it sounds pretty basic. It is crucial and will help you to know the best practices that you should follow to reach your investment goals.

Read Also:  Can Crypto Climate Accord Ease Bitcoin?

In your swing trading plan, make sure that you include the entry and exit points and the rates in which you should stop out for a loss.

It is good to have a written plan because it will be immensely helpful in creating a better and more effective crypto swing strategy.

Keep an Eye on Bitcoin

Since Bitcoin is widely used and has the largest market cap in the market, you should pay close attention to it specifically.

This will help you to know more about the price movements and relate it with the particular type of crypto coin you are trading with.

Typically, the reason behind this is that the price movements of most altcoins are linked with that of Bitcoin very closely.

Therefore, when the price of Bitcoin rises steadily over time, it indicates that is the best time to trade.

Use a Demo Account

If you are new to this field and have still not made up your mind as to whether or not crypto swing trading is your forte, you should always practice it first hand by creating a demo account.

This will help you to access and know about the crypto market and the price movements in real time without risking your capital.

With the knowledge gained in the process, you can make proper trading decisions down the road on your own.

Consider the Fees

Usually, the spread is charged less in swing crypto trading because fewer trades are placed.

However, there can be an accumulation of swap fees when you hold your positions overnight. These swap fees are actually the interest charged on your holdings daily.

There may also be crypto trading taxes levied on your trades but that will depend on the specific jurisdiction.

Moreover, there may be a few brokers who may charge higher commissions and also include other fees related to your account along with it.

Therefore, research well before you sign up with one.

Educate Yourself

You should go through a lot of different resources to educate yourself about the crypto swing trade.

You will also need to know about the different tools that will help you in your trading process.

With such knowledge you will be able to ease yourself in this form of crypto trading, even if you are a novice.

There are several online resources to gain knowledge on crypto swing trading. You may choose a few websites that publish good articles and blogs on crypto swing trading.

You may also read different books and journals online and even join a community forum to discuss matters.

Alternatively, you can also take up one of the many crypto training courses available online.

All these will also help you in trading effectively and even choose the right crypto broker for that matter.

Choose the Right Approach

Choosing the right approach is necessary for successful swing trading of crypto. There are two most popular and productive crypto swing trading strategies to follow.

One is to make the best use of the resistance and support levels. Often termed as the ‘Stuck in a Box’ method, this strategy is followed when the crypto coin price is in between the two lines of the box, above and below.

When it goes below the line, a candle is closed above support indicating a sturdy price rejection. The trader needs to wait and go long on the subsequent open candle.

The main objective of this strategy is to exit the trade ahead of the selling pressure coming in at resistance.

However, this approach needs a strong understanding of the support and resistance levels as well as the daily candlestick.

You will also need to know about the take-profit and stop-loss features so that you do not exceed the specific levels.

The other approach is the ‘Catch the Wave’ approach which means riding with the coin in the trending market.

In this method you enter into the crypto market only when the pullback has broken. In order to follow this approach, you will need to first identify the trend based on the Moving Average over a particular period of time.

If the market nears the Moving Average, you will need to wait for the bullish price rejection and then move on to the following candle.

In this case, you must set the stop-loss beneath the candle low and subsequently set the take-profit immediately when the price swings higher.

This is the rule of thumb to follow in this particular approach in crypto swing trading.

Select the Right Crypto

You must also select the right type of crypto coin for swing trading.

Ideally, it is better to go with those that have a larger market cap since these are actively traded and widely used coins among most of the popular crypto exchanges and marketplaces.

Read Also:  Is Crypto Worth Investing by Taking on Debt?

As said, earlier, these include Bitcoin, Ethereum, and Tether.

Choose the Right Crypto Exchange

It is needless to say that you will also need to choose a reputed, safe and reliable crypto exchange for trading your coins.

There are several crypto exchanges and P2P platforms out there but all are not created equal. Therefore, you will need to do a little bit of research on your own.

While researching, you should look for specific aspects and attributes of the crypto exchange such as their safety measures, security features, trade volumes, and number of users, transaction fees as well as all other vital information that may be necessary.

Care for the Waiting Period

Never take the waiting periods lightly if you want to be a successful crypto swing trader. Since, prices of cryptocurrencies are very unpredictable, waiting for the right time is elementary.

Moreover, it is not possible to predict the price movements accurately due to the volatility of the crypto markets.

Therefore, waiting for the right time will ensure that you have a fair idea about the momentum of the market and price movements and avail more opportunities over days or weeks.

Start Small

Finally, you should never overlook the risks involved in crypto swing trading. Just like all financial activities, there is a significant risk of losing your funds altogether.

Therefore, never invest more than you can afford to lose. Always start small because that will prevent you from taking trading decisions based on emotions and increase the chances of incurring losses.

Since the crypto market never closes, you may want to make overnight trades sometimes. In such cases, it is better to use a stop-loss tool.

This is one of the best ways to mitigate losses while making overnight trades. This will protect your funds and for that you will not have to stay awake all night.

Pros and Cons of Swing Trading Crypto

There are significant advantages and disadvantages of swing trading crypto though the benefits seem to be more in number and significance in comparison to its downsides.

These downsides, however, if not known, may pose significant challenges to both, an experienced trader or a beginner.


Swing trading crypto is not a long term strategy and therefore you do not need to wait endlessly to make profits. Usually, you will get to see it within days or even weeks, at the most.

It is also much less stressful as compared to other forms of crypto trading. Swing crypto trading usually has much lower frequency of trades and a much longer timescale which therefore does not need you to sit in front of the computer the whole day straining your eyes as you would in day trading.

When you are into swing crypto trading, it will be like getting involved in a part-time job. You can keep your other commitments and even carry on with your full-time job successfully.

Volatility is the key in swing trading crypto mainly due to the nature of the coins. Bitcoin is highly volatile in nature which is why this is one of the most popular and widely used crypto coins by the traders for swing trading.


The risk of holding your position overnight is most prominent and can result in substantial losses. Also, the swap fees overnight may also reduce your profit.

While holding your positions overnight you may also experience some price gaps, which is quite a common thing to happen on the weekend. The primary reason for these gaps to exist is that the crypto market never closes and reports or developments often occur during the after-hours.

And, making out the right timing for a market swing can be quite tricky even by a professional and expert crypto swing trader.


The fact that swing trading crypto takes less time and is comparatively less stressful makes it more alluring. However, if you are new to it you must learn how to do it following the basics of it and the best practices to meet all your needs.