My name is Marek Hawk and I am a professional trader of Horizon Trading team. In one of our previous articles we explained you that the main key element of steady income from trading is a strategy diversification. Swing strategy is one of my favourite trading styles because it is not time demanding activity. We use swing strategy based on our Horizon Trading system, which is very easy to trade, and in this article, I will show you how you can use the Horizon swing strategy in your favour. It is perfect solution if you do not want to spend much time actively trading and let your money work for you meanwhile you are focusing on something else!
What Is Swing Strategy?
Swing trading is a middle-term trading style that requires keeping your trades opened for several days. It is ideal for those who can’t monitor their charts throughout the day but can dedicate a little time for analysing the markets. This is probably best suited for those who have full-time jobs or school but have enough free time to stay up to date with the market of their interest. Swing strategy solve the problem of time demanding.
Swing trading attempts to identify “swings” within a medium-term trend and enter only when there seems to be a high probability of winning. For example, in an uptrend, swing trader aims to buy (go long) at “swing lows – higher low.” And conversely, trader can sell (go short) at “swing highs – lower highs” to take advantage of temporary countertrends.
The chart of GBPUSD demonstrates how we can use simple identification method of the swings. In a downtrend we are seeking for the lower highs for opening the short position and during an uptrend we want to ideally trade the higher lows of the swings. In reality, to trade profitably swing highs and lows can be very difficult and we need to add more sophisticated rules if we want to extract money from the markets. After reading whole article you will be able to extend this simple principle of swing trading strategy by our Horizon system which gives you precise rules how to behave on the markets as how we do.
Swing Trading with Horizon
As may know Horizon trading system works perfectly with all the markets and very fast timeframes, however, Horizon also nails swing timeframes like 1 hour, 4 hours and 1 day. Horizon swing trading strategy has clear and objective rules, it identifies big buyers and sellers and helps to realize where stop losses are accumulated. In other words, "Horizon" strategy detects direction and the best spots where to enter markets and close trades.
Trade with the Main Flow
First, we need to spot the flow of smart money and then we can speculate on that direction. How can we find the direction of the flow of smart money? We need to find an impulsive movement! An impulsive move is one whereby the market moves quite strongly or heavily in on direction, covering a great distance in a short period of time. These moves tell you when the imbalance between the buyers and sellers is strong and there is heavy participation from the big institutional side.
Logically, more money can be made during these impulsive moves, as they cover more points or pips in less time. They are generally more volatile, and thus provide us with great opportunities to get more R (reward) with less risk since the market will stretch more easily in one direction. But no matter what, we want to be trading with these moves as much as possible, not against them.
Let’s look at GBPUSD. The impulsive movements are marked by red markers. You see on this chart that market participants are moving the price in-line with the direction of impulsive movements. These movements indicate the priority direction of our trades. As a trader you will be successful in long-term perspective if you select the trades with the direction of the main flow of big players.
Here on another example Horizon Swing Strategy helps to identify the main direction on AUDJPY. After impulsive movement up the market opened with gap and offered nice risk-reward ratio. After the rejection of price on the level 84.000, smart money flow has changed. We saw the impulsive movement down which changes the perception of the main direction: our priority direction is down now.
Levels to Open Trades
After years of trading and working with the levels, we found in our trading team that the best way how to work with the levels is based on spotting accumulation levels of big players. It is the safest method how you can trade.
Why is this the safest method to trade? Conventional technical analysis works with support and resistance levels as the levels of rejection of the price. However, it is better to think about the market in the way how it works.
Price is moving because of activity of traders, but can controlled by massive money flow, and it is necessary to think about the markets from the position of institutional, smart money traders. As you may know these are the players who are profitable mainly.
Big players care about liquidity in case of gaining bigger positions. It is more likely that they will get filled full size at a good price levels in the zone of the consolidations. Consolidation represents the place of orders assembly, for example one of common techniques is putting stop-loss on break-even after price geos in trader’s favor. Smart money player knows that, and he can use this information for scaling his position while he is taking weak players stop-losses. Our system can spot these actions and takes advantage of that. Therefore, our system is very progressive and successful.
Look at GBPUSD again with the marked level of accumulation zone. You can open the trade directly after the retest of zone or even better wait for the retest of the consolidation structure. You can use
Horizon swing short situation on GBPJPY. Big players used stop-losses of weak traders to gain their positions.
In this article I described why swing trading is one of our pillar of trading diversification. Time effective strategy for anybody who would like to let his money work for him or her. I presented to you a few elements of our powerful swing strategy which you can in-build into your swing trading system. In case of interests how we are making money with our Horizon Swing Strategy, come and visit us to our webpage and socials: