How to Swing Trade for Beginners: Easier Than Day Trading

[00:00] Look, I'm going to make this simple for you.  The more time that you give yourself to trade,   the greater the probability of success. All  that trading really is, is pattern recognition,   entry execution, mixed with a little  patience. Pretty simple, right? Well,  

[00:14] Be sure to stick around to the end because  no matter how easy trading should be. It's   not going to be, if you don't have certain  things in order. Now, without further ado,  

[00:26] let's get into how to swing trade. So  real quickly, before we begin charting,   I want to stress the importance of timeframe  and finding which ones work for you. So when it comes to swing trading for me,  uh, I find the four hour. The weekly and the  

[00:42] monthly to be good timeframes. We'll usually  find much larger moves on larger timeframes,   but they're also going to require more  patience for the setup. So over time,   kind of play with the different timeframes,  see what works for you, but I want to show you,  

[00:56] you can see right here on this lower timeframe,  you can see a lot more consolidation. So right here, this is from about  July 12. To about July 24th,  

[01:09] if we look at this on a weekly chart, it's  literally about three candles. Whereas on   a monthly chart is not even, it's just a  little wick right here. So I want you to  

[01:24] just see the significance in the difference  before we really get in and start charting. All right. So now the first thing that  we're going to take a look at in charting   is just going to be. Supply and demand. So  looking at it, the market does not move in  

[01:40] a straight line. So it's always either  making higher highs and higher lows,   which this is an uptrend making lower lows  and lower highs, which is a downtrend.

[01:56] And then sometimes it just sits and consolidates  make same highs and same lows. And whenever   this happens, it leaves behind zones that  cause these movements. So taking a quick  

[02:08] look at it right here, if you look at the  uptrend, it's going to be kind of like this,   this right here, it comes in and  it kind of just barely taps in. And this is a demand zone. That is the move  that initiates the break of this high right  

[02:26] here. And then as this happens right here,  this zone is going to leave another demand   zone which leads to the break of  this high. Similarly, over here,  

[02:41] this is a supply zone which pushes the price  down causing the break of this low right here. And then over here, It's just this is just  trading in a range so no supplier demand to  

[02:54] be found because there are no new highs or lows  So looking at the chart Looking for highs and   lows and market structure. You can see that  right here the highest high is kind of over  

[03:07] here and the Last candle that leads to the break  of this high over here It's this one right here. So this right here is a demand zone. So that's  how you find a demand zone. And then looking  

[03:22] for a supply zone, whenever you start a downtrend,  which it looks like we kind of started over here,   whenever you start a downtrend, which it  looks like, uh, we kind of got a change of  

[03:34] trend. Once we broke below this right here, the  last bullish candle is going to be supply zone. And as you can see, We kind of came back or we  came up here, sold off, came down to 25. And  

[03:51] now we're kind of testing this area again to  see if we're going to make new highs. That's   a quick lesson on supply and demand. That's just  one thing we're going to mark up the charts with.   All right. So looking at it in order to  draw a trend line, all you need to do  

[04:08] is be able to get About two points on a  chart. So if we look at this right here,   you can see, uh, I'm going to take  the trend line tool. I'm going to draw

[04:25] and we can see that we can see  that right here. I got one Two,   three touches. And then we've got a break of the  trend. And then with the break of this trend,   we sold off and came down here to this  level of support. This trend line is  

[04:40] serving as a level of support, which holds  the stock price up. Trend lines can also. Be resistance, which serve is kind of like a  roof, which holds the stock price down. So looking  

[04:52] at it, this is what a trend line looks like. If  you're able to recognize when you're a trend line,   it's trading becomes pretty easy. If you sell at  the top of a trend line and buy at the bottom,   say we come up here to 2639, we sell at the  top and go right down to the next touch.

[05:11] The next touch that is an 11 percent return.  And then say, We buy in at this touch over   here and sell out at the next touch.  The next touch is all the way up here,  

[05:28] which is a 20 percent return. Now, say we take  that and kind of try to sell off until the next   touch. It's not as great of a return to the  downside, but this is an ascending channel,  

[05:43] so maybe if you see the channel is going  up, you only want to buy to the upside,   and then when you get the break of it to  the downside, maybe that's when you start. the last element that we have aside  from trend lines and supply and demand,  

[06:01] we also have support and resistance. So whenever  you have areas where the stock Trade sideways or   comes and touches a lot and rejects. Those are  going to be levels of support or resistance.

[06:16] So looking at it, we have a level kind of a  area of support right here. If you look at it,   depending on if you're on a lower time  frame, it's not going to be as pretty,  

[06:30] but I'm say right here at this 20, 70 range,  I would say this is a good area of support. And then. Kind of up here. If you  take a look, we have it over here,  

[06:46] over here as well. This 2730 area is going to  be a good level of resistance. And then while   you're above it, when you go above resistance,  it becomes support. And whenever you go below  

[07:00] support, it becomes resistance. So  that's how you draw a trend line. That's how you draw a support and resistance.  Now we're going to take a look at all this,   how it all works together. And. Talk  about how to actually take a trade  

[07:14] but we're going to be doing it on the weekly chart  just because it's like, yeah, you can do this. you take support and resistance and  draw it on a different timeframes,  

[07:30] you can also see there's an area right here that  can serve as support or resistance. You see,   it comes up here. It has a little bit of  trouble getting over. Then we come back  

[07:44] below. You can kind of use support and resistance  as levels for the trade along with trend lines. So when you're taking trade, you could take from  this as support here from this trend line. And  

[07:56] also from this line of support and resistance,  this takes you all the way up here. And it's like,   Oh, this is an old. This is an old  key level from back here. And we had  

[08:10] all these touches over here. So it was  like, Oh, maybe I'll take profits here. Or maybe, Oh, we got above this. We're probably  going to the next area in the trend line. All's  

[08:22] trading is, is pattern recognition. The sooner  that you're able to recognize a pattern and.   The sooner you're able to see that there is a  pattern, the sooner you're able to take advantage  

[08:34] of it. So taking a look at it over here, you  can see we have this supply zone that we drew. Actually, uh, we came up here,  sold off once. And once again,   we're pretty close to this trend line, actually.  So those are kind of, this is what would be known  

[08:51] as confluent. You have two Kind of factors  that work together that will tell you, Hey,   this is probably going to sell off in this  area. Looking at this, if we were looking at  

[09:03] a lower time frame, uh, you can see right  here, we came back up to supply sold off. Next thing we'll want to do right here where it's  at is see how it responds to this area of support,  

[09:16] this little support level. And then.  You can kind of see a little trend   line right here as well. So we'll  kind of see how that plays out. Um,   see how it holds up support here. Let's  actually go down to a lower timeframe.

[09:32] So if we were trying to draw a trend line  for now, it looks like there could be one   right here, but going back up to the  four hour. This is all we really have,  

[09:46] so not too much strength at the moment.  This is how it can look whenever you're   charting. Usually it's going to be better  for your mind to have less things going on. So me, I typically just use Supply, demand,  support, and resistance and trend lines. And  

[10:02] then once something's not relevant, like this  line up here, I clear it off the chart and kind   of go on to the next. Now, real quick, I want to  do this, taking a look at another chart on the  

[10:16] weekly chart. Uh, talk about where to enter the  trade, where to set stop losses and take profits. All right. So here we are looking at  the spy on the weekly chart. And yeah,   I'm going to start off by drawing what  I see. I see a demand zone here. I  

[10:36] would honestly say it's less relevant when  you're far away. I see a demand zone here. I see a demand zone right here. Alright,  so this is what I see on the spot. And then  

[10:57] I think I see a trend. So if we take a look,  um, right here, we got two points on the line,   third time and kind of broke through  notice. When we get the breakthrough,  

[11:09] it went from 5 45. And then this candle  right here was confirmation down here   at five 30 that we have broken the trend  and are now kind of in the downtrend.

[11:21] We'll see how this candle ends up closing. If  we look at this demand zone, uh, we did open   this candle down at about five 10. We did  make our way back up to about five 30. And  

[11:36] now it looks like we may be making our way  down To the next level. So the next thing I   see here is actually a level of support right  here in this kind of five 90 or four 95 area.

[11:54] You can see. We had, we spent a little,  like a few candles over here where this,   it was holding up, we came back and we  kind of bounced off over here. So I see   this as a level of support. So yeah, that's  the next thing I'll kind of watch out for.  

[12:10] And now looking at it, this level right  here, this five, 2352 or this 524 area. This looks like a level of resistance. It  looks like a level that there's going to be  

[12:24] trouble because if we look at it, you can see  over here, it looks like there's some trouble.   Uh, you can see like it had trouble getting above  and it sold off there. And then over here, Uh,  

[12:37] the resistance became kind of support because it  went up and then came back down to the same area. And now it's serving as resistance  again. Now that I have this, uh,   let's say I noticed this and we  came back up here and I noticed,  

[12:52] Hey, we close below this. If I was going  to take a trade from this, it's like, okay,   it looks like we're holding below 24.Maybe I  come in, I put my stop over at this next level.

[13:07] Uh, this kind of, 532 area looks like a level  of resistance, like another one. If you look   at it right here, it had a little bit of trouble  getting above this for a little bit. So now say  

[13:22] I set my stop loss kind of in that area, and  then I kind of target this area right here.   It's a 3. 18 risk reward ratio, which  means I can take this trade three times.

[13:35] Uh, get it wrong twice, get it right once, and  still make profit off the trade. So looking at   this, yeah, I would enter this trade right here  at about 523, 524. Look forward to come down,  

[13:51] test this low around four 94 and then, yeah, I  have my stop loss up here at about five 30 to 50   things to consider while you are  riding a trade to the downside,  

[14:03] the further end profit you get, uh,  you can set your profit as you go. So as you make these movements, there are  different levels. You can see this, like,   uh, you see there's wicks at this level right  here, this five 17. So as we get below this,  

[14:18] this would be a. Level that, hey, maybe I'll  move my stop up here to 523. 50 once we hold   below this. And then there's another  one kinda right here at this 513 area.

[14:32] And it's like if we get below that, maybe I  move my stop to about this 517 or 518 area.   And then the next area looks Like it's  about, uh, maybe this five Oh eight area,  

[14:44] then move it here as you're in the trade, as  you're up more, you want to move your stop loss,   maybe even it's like your risk ends  up looking something like this and  

[14:56] you just completely just move your trade to  kind of emulate it after a certain point. You're not really risking anything because  you're. So deep in profit, there is nowhere  

[15:09] to lose. All that seems simple enough, right?  There's still one thing that can get in the way   of all that. You. If things aren't right with you,  if you're not taking care of things in your life,   if you're not taking care of your health,  if you have a lot of stuff going on,  

[15:23] like say a big move or say you just got  in a big fight, uh, if there are things   going on in your life, trust me, I know from  experience it pours over into your life. you. Make sure you have some other form  of income to take care of everything.  

[15:42] So that you're not as stressed so that  you don't need to dip into your trading   funds before the trade is over. If you  haven't already taken advantage of it,   Right now, when you sign up using my link,  they are offering anywhere from eight to 20  

[15:59] free stocks. Uh, this is a deal you won't  get from anyone else's referral link. So   be sure to check that out down below  in the description. When you open the   If you enjoyed the video or learn anything,  be sure to smash the like button. If for some  

[16:15] reason you're new here and haven't  already be sure to subscribe. And   last but certainly not least Matthew Manuel  signing off. And I want to change your life.