Beginner in trading? Discover why swing trading is safer and more profitable than day trading. Learn pros, cons, risk levels in both trading methods and a simple swing trading strategy that anyone can use.
Table of Contents:
- Introduction
- What is day Trading
- What is Swing Trading
- Advantages of Day Trading
- Disadvantages of Day
Trading
- Advantages of Swing Trading
- Disadvantages of Swing Trading
- Why should I avoid Day Trading
- Why should I Stick to Swing Trading
- My Simple Swing
Trading Strategy (with Real-time Examples)
- Bonus Tips for Long-Term Success
- Final Thoughts
- FAQs
Introduction
New traders often get excited by the fast pace of day trading. But that
excitement can quickly turn into stress and losses. This guide explains why
swing trading is better for beginners and how you can get started the
smart way. I also share my tested swing trading strategy to
help you make informed decisions. So simple is the strategy that a beginner can
deploy it easily.
What is day Trading
Day Trading or we call it Intraday Trading means buying and selling a
stock (or any financial product) on the same day. You enter a trade
in the morning and try to exit with profit before the day ends. Traders who
practice such type trading are called day traders. They try to gain from small
fluctuations of stock prices.
You need to watch the market all day.
You make many trades each day.
You rely on small price changes to make profits.
Example: You bought 100 shares of ABC Company at ₹120 in the morning at
around 10.30.And you sell it at ₹140 at around 2 pm or before the market closes
on the same day. Your intraday profit is ₹2000 (100×20).
What is Swing
Trading
Swing trading means holding a stock for a few
days or even weeks. You don’t need to sit in front of the screen all day.
You look for bigger price moves (swing s).
You use daily charts instead of
minute-by-minute updates.
You spend less time trading but
aim for bigger profits.
You bought 100 shares of a certain company at
Rs.120 on any trading day. After 5 days or 15 days you saw that the price of
the said company reached at Rs.180 and you sold the shares. Your profit from
the swing trading is Rs.6000 (100×60).
Advantages of Day
Trading
No overnight risk (you exit before market closes)
Frequent profit chances in one day
Immediate feedback-wins or lose fast
Can be exciting and profitable for experienced
traders.
Disadvantages of Day
Trading
Requires full-time screen time and fast 𝗱𝗲𝗰𝗶𝘀𝗶𝗼𝗻𝘀
Very high stress and mental 𝗽𝗿𝗲𝘀𝘀𝘂𝗿𝗲
High brokerage and transaction 𝗰𝗼𝘀𝘁𝘀
Small profits per trade, losses can add up
Most beginners lose money (90% people are making
loss)
Advantages of Swing
Trading
Requires less screen time—great for people with 𝗷𝗼𝗯𝘀
Bigger price moves = better profit per trade
More time to plan and think before placing trades
Lower costs—fewer trades
You can use both charts and company 𝗳𝘂𝗻𝗱𝗮𝗺𝗲𝗻𝘁𝗮𝗹𝘀
Disadvantages of
Swing Trading
Risk of overnight market news or 𝗴𝗮𝗽𝘀
Trades may take longer to show 𝗿𝗲𝘀𝘂𝗹𝘁𝘀
Requires 𝗽𝗮𝘁𝗶𝗲𝗻𝗰𝗲
You must learn basic chart 𝗿𝗲𝗮𝗱𝗶𝗻𝗴.
Why should I avoid
Day Trading
Too fast for beginners
Emotionally draining
Most people lose money in day trading
Higher transaction costs, due to higher quantity of
trades
Not suitable for other people attached with other
profession
Needs big capital to meet margin rules
Why should I Stick
to Swing Trading
Beginner-friendly and easier to
manage
𝗠𝗼𝗿𝗲 𝘁𝗶𝗺𝗲 to learn and improve
Less stress, more flexibility
Better risk management
Can trade part-time while working a job
Focuses on quality over quantity in
trades
My Simple Swing
Trading Strategy (with Real-time Examples)
I believe in keeping things simple when it comes to trading. I avoid
loading my charts with too many indicators or complicated data. My goal is to
keep the setup so simple that even a beginner can understand and apply
it.
Chart Setup I Use
I use daily candlestick charts for all my trades.
My favourite trend indicator is the Exponential Moving Average
(EMA), especially the 20 EMA.
I prefer EMA over SMA (Simple Moving Average) because EMA reacts more
quickly to recent price movements.
I also use the Relative Strength Index (RSI) with
custom settings of 60 (overbought) and 40 (oversold) instead
of the default 70/30.
How I Select Stocks
I look for strong stocks that belong to strong-performing
sectors.
The stock should be in a clear uptrend for a long time.
I regularly check daily top gainers to find such
opportunities.
Before entering, I also check the overall market trend (Nifty,
Bank Nifty, or sector index) to see if the market is in an uptrend, downtrend,
or sideways movement.
Entry Rule
I enter a trade only when:
The stock crosses above the 20 EMA from below and closes
above it, and
The RSI is above 50 (RSI 60+ gives stronger
confirmation).
If this setup is formed, I place a
buy order above the high of the candle that closed above the 20 EMA.
Stop-Loss Rule
My primary stop-loss is
placed just below the low of the entry candle.
Alternatively, if a full candle closes
below the 20 EMA, I exit the trade immediately.
Target or Exit Strategy
I book my profit when a candle closes below
the 20 EMA.
𝐎𝐫, if the trade
moves against me, I exit at the stop-loss level.
Note: Entry is mostly
straightforward with this method. However, exit points may
vary depending on the trader’s psychology, goals, and risk tolerance.
See the below
charts as Real-Time Examples:
The above chart is of Bharti airtel on daily time
frame. The green line on the chart is 20 EMA. On 10th September, 2024 a green
candle closed above the 20 EMA. We noticed that RSI was also approaching above
60.
We entered on the stock above the high of the green
candle at Rs.1583, keeping a stop- loss at Rs.1544.On 27th September, 24 within
17 days a red candle closed below the 20 EMA (Entry, Stop-loss, Exit)
everything marked on the chart. Exited at Rs.1724, a huge profit of Rs.157.
Now, look at the 2nd chart of Bharat Electronics on
daily TF. On 15th February, 2024, We entered into stock above the high of the
green candle at Rs.186, keeping a stop-loss at 181.On 12th March, 2024 we
exited at Rs.210.Entry, Exit, Stop-loss marked in the chart.
This simple, clean, and rule-based swing trading
strategy has helped me trade with confidence and discipline. It avoids
confusion and keeps emotions in check—two things beginners struggle with the
most.
Bonus Tips for
Long-Term Success
Trade with a plan, not on impulse
Maintain a trading journal
Review your trades weekly
Keep learning reading books, blogs watching videos
Stay calm, don’t let emotions ego control your decisions
Be patient, stick to your system or trading setup, profit will automatically
take care of you
Accept losses and learn from them.
Final Thoughts
Day trading may sound
exciting, but it’s risky, stressful, and often unprofitable for
beginners. Swing trading gives you more time, better control,
and higher chances of success. With the simple strategy I shared, you can trade
part-time, manage your risk, and still grow your money steadily.
Start small, follow your plan, and stay consistent with
consistent and regular practice. That’s the real key to winning in the stock
market.
FAQs
Q1: Can I make a
living from swing trading?
Yes, but it takes time, discipline, and consistent practice.
Q2: What tools do I need to start?
A good trading app, basic charting tools, and reliable internet.
Q3: Can I start with ₹10,000?
Yes. Start small, learn the process, and grow slowly.
Q4: How long should I hold a swing
trade?
Usually between 3 days to 3 weeks.
Q5: Should I use leverage as a
beginner?
No. Avoid leverage until you have experience. It increases risk.
