Swing trading is a trading methodology using technical investigation in order to establish the predictable trading trend of a particular stock. Profit is earned by buying the stock at the low end and then selling it at the high end of expected trend. It is termed by others as channel trading or channeling and is best described by its famous short period of trading policies. Swing traders seldom hold on a position longer than five days. Most often they get employed and dismissed by a company on the same day. Swing trading is suitable to experienced individual shareholders and day to day dealers.
Swing trading happens very fast, as prices of stocks may rise within minutes. The time frame is very short for swing traders. They quickly identify a trend that has a tendency to have an extensive rise in stock volume. When the stock value reaches its peak then the swing trader quickly sells these stocks as fast as possible. This can only happen if the overall market of stocks has no specific prejudice. In other words, the market in general does not head in one particular direction. If it does, then it is very hard to recognize trending stocks because most of the stock prices just follow the market drift.
Swing trading software is now available to help investors and day traders in determining which stocks to buy and then when to sell these stocks. It is also known as Day trading software and is a great help in computing and predicting suitable stocks that will yield profit when bought during its decline in price and then subsequently sold during the rise in its price. Users of this kind of software will find it easy to swing trade stock for the reason that the software will do all the necessary computation within minutes compared to manual computing that takes hours long.
Swing trading software is currently being used by experienced and newbie investors alike. To be able to maximize the utilization of this kind of software, the user must be able to understand the different stages of stocks in a stock market. The first stage is called flat trading. In this particular period, the stock has recovered from a downward trend but is not yet ready to rise up yet. During this stage, the investors find the base of the stock. The second stage is called the upward swing. This is the tricky stage where the price of stocks constantly fluctuates. If the price goes up, then it goes to the third stage called resistance. In this period, the price of the stocks reaches its peak. After reaching the peak, the prices of the stocks will go downward again. This is the fourth stage commonly termed as downward movement. Once the newbie swing trader understands these stages, then he or she is ready to gain experience in swing trading.
Since the function of swing trading software is to identify the best trend of a particular stock and computer whether or not to swing trade that particular stock or not it is very similar to stock trading software. The difference is that in stock trading software any kind of stock, whether the stock will yield profit or not, can be processed. Swing trading software on the other hand is concerned with only fluctuating prices of stocks that have a low end trend first but will eventually pick up a high trend after a few hours or a couple of days at most.
Most swing trading software available in the market today offer real time results. This is an important feature for the simple reason that swing trading is mainly based on a spike in the price trend of a particular stock. The user of the software must be alerted during the time the rise in the prices happen for the software to be considered as a real-time application. Once the software alerts the user, the latter can now make the suitable decisions based on the data and information that the software has gathered together with the latest news and events that are currently happening in the prices of the stock to be swing traded.
Also similar to swing trading software is the option trading software. The former is used as an independent program or application from Microsoft Excel. It has been programmed using a different programming language by its developers. Most swing trading software boasts of its user-friendly interfaces and easy to understand instructions and step by step guides in the world of swing trading. Option trading software, on the other hand, is a stock trading option application or program that is used with Microsoft Excel. Most kinds of option trading software use Black-Scholes option price model in order to imitate and evaluate different stock option trading stratagems. It is primarily used by experienced and veteran swing traders as it is not as user-friendly as most swing trading software.
Investors and day traders engaged in swing trading stock buys low priced stocks that have a potential trend to have high prices in just a short span of time. They make use of expected market buy and sell algorithms or a scientifically calculable set of trade rules that can predict the future of stocks in the market. As of the year 2000, many banking firms invest time and money in researching these algorithms in order to further expound the theories behind it. These investments and research led to the further development of the swing trading system. This system is now widely used in stock markets all over the world in analyzing the rate of growth of a particular stock in a short period of time.
Today, Forex markets are one of the largest buy and sell markets available in the world and also one of the most accurate. The different rises in international commodities like oil and natural disasters like hurricanes and earthquakes can send the Forex market into a downfall or steep climb. Forex Swing Trading is the application of swing trading into the Forex market by taking advantage of the surges in international commodities, the different financial status of multi-million companies together with calamities and disasters that strike the heart of these companies that may give a rise or fall to their stocks.
Veteran investors and experienced traders take advantage of option trading software together with swing trading strategies and other swing trading applications in order to make huge amounts of profit. Together with the latest news regarding stock market prices usually coupled with a good hunch, these people have matured into making instant decisions about buying and selling of stocks. By employing a good swing trading strategy, they find out what particular type of stock to buy at a particular time and when the price this type of stock will skyrocket. When the prices are at its peak, they will now sell these stocks in order to garner profit.
The most fundamental swing trading approach includes extensive preparation for the upcoming trading week. Most veteran investors prepare during the weekends in order to be ready for the opening of the stock market on the first working day of the week, usually Monday. They spend this time gathering the necessary data and information coupled with the necessary computations and predictions of the stocks that can be potentially swing traded. Swing trading software, option trading software and forex trading software are a great help in gathering accurate computations and predictions. You will necessarily find this kind of software in the possession and use of experienced swing traders.
Although swing trading is a famous way of making profit thru buying and selling of stocks, it is accompanied with huge risks. There are times when the prediction using scientifically based computations will not follow these computations. This is a big risk that swing traders undertake whenever they buy stocks. However, by using swing trading software, option trading software and forex trading software, the risks involved are greatly reduced. Just make it a point to buy the software with the most accurate computations and predictions in order to have more precise data or information in choosing what type of stock to trade at a particular span of time.
To find the right swing trading software, the application must have numerous features that will help the swing trader in gathering the right information and computations in order to justify their predictions. Since a swing trader cannot be present at the stock exchange 24 hours a day, the swing trading software must offer live updates regarding the latest in stock trends. This should compose of stocks that have a huge potential in rise coupled with an accurate prediction of the trend of the stock. Also, the swing trading software must also have compatibility with different mobile form platforms. Given that a swing trader cannot be in front of his or her computer everyday, whenever there are updates in the stock market, an alert in the for of a text message must be sent to the swing trader in order to for him or her to initiate the proper action. The swing trader must also have access to the software thru his or her mobile phone in order to engage in trading the stocks even when not in front of a personal computer terminal.