Bitcoin Swing Trading
What is a ‘Swing Trading’
A style of trading that attempts to capture gains in a stock within one to four days. Swing traders use technical analysis to look for stocks with short-term price momentum. These traders aren’t interested in the fundamental or intrinsic value of stocks, but rather in their price trends and patterns.
BREAKING DOWN ‘Swing Trading’
To find situations in which a stock has the extraordinary potential to move in such a short time frame, the trader must act quickly. Therefore, swing trading is mainly used by at-home and day traders. Large institutions trade in sizes too big to move in and out of stocks quickly. The individual trader is able to exploit such short-term stock movements without having to compete with the major traders.
The primary strategy of this swing trader is to patiently trade major market movements. The first trade in September #1in the chart above is a great example of taking a long-term view on the market and opening an appropriate position even if the market is flat. We follow the trend up till #2 around $450 where a huge spike occurs out of the bollinger band range which creates selling. This is a good time to sell and close your position looking to take profit at $370. Having a neutral position now looking for a new range.
Bitcoin Swing Trading at #3 we are looking to buy as prices stabilize between $340 and $300. The price is not touching the lower band creating a bullish signal. I would have stop at $300 any move down below there is very bearish. The Bitcoin price begins to trend up and finally breaking the trend at around $440 closing your position here #4. I would have a neutral position here as it could go either way.
At #5 it touches the lower band at $400 and forms an uptrend. Support has been established at $460 at #2 and #4 so we are looking to close the position at $450 and look for move above $470 or below $430. At #6 it reaches support and sells off now we’re looking to sell at $430 and sell at the lower band which occurs at #7. Closing the position at $380. Bitcoin Swing Trading at #7 a spike occurs outside the range giving a bullish signal and would look to take profit at $400 then take a neutral position.
Bitcoin Swing Trading waiting till #8 as the price ranges between $400 and $360. The price never touches the lower band a bullish signal so buying bitcoin at $380 looks good and having stops at $360. A new trend is formed and tops at $450 a good place to sell as $460 is support. Because I am overall bullish on Bitcoin I think the $460 support will fall at some point Bitcoin to $1000.
A small position is ok at this price waiting to accumulate on a dip to $380 or a move above $460. I have no position in Bitcoin this is all hypothetical trading.