How to Start SWING TRADING as Beginner in 2025

Are you too busy to day trade? Is day trading too fast or risky for you? Well, swing trading might be perfect for you. Welcome back to another Humble Trader video. Today, we have a highly requested topic: how to start swing trading. Most of you have watched my day trading videos, but that's never enough—you just want more! If you're new to the channel, my name is Shay, AKA Humble Trader. You're about to learn a lot of trading tips, from beginner to pro trading strategies, so make sure to subscribe and smash the like button!

What is Swing Trading?

Swing trading means taking a trade that may take a couple of days, weeks, or months to develop. So, should you day trade or swing trade? Hear me out—swing trading doesn't require a precise entry and is more suitable for those who are busy, like working a 9-to-5 job, are parents, or are part-time traders. It may require less screen time and less time sitting in front of the computer, but a mature swing trader still spends a lot of time researching.

However, since you are holding a position for a longer time horizon, you have more exposure to overnight market risk. Be careful, stay attentive to macro environment changes, and always read the news. In swing trading, you may have to use a wider risk, but at the same time, you might be set for a potentially bigger reward.

How to Start Swing Trading

Step 1: Analyze Bigger Time Frames (Daily & Weekly Charts)

Always start analyzing from bigger time frames, especially the daily chart. When I'm day trading, I have my daily chart and my intraday chart side by side. However, when I'm swing trading, I ignore the intraday chart and only look at the daily and weekly charts.

If I’m swinging for just a couple of days, I use the daily time frame, and if I plan to hold longer than a week, I look at the weekly chart. For example, on the QQQ, I see that we are retesting the weekly key support level. We previously broke it in May and June, during a very bearish market, but now we’ve made a higher low and are trying to hold the 300 mark. If we break below 300, we could retest the lows around 270s, which also aligns with the 200 SMA on the daily chart.

Support and resistance from the intraday chart apply here as well. We have resistance around 330s and support around 270s. Keep these levels in mind as they will help in identifying entry and exit points. Additionally, notice the major downtrend from December 2021—this is crucial for swing trading.

Step 2: Timing Your Entries and Exits

Now that we’ve identified major support, resistance, and a downtrend, it’s time to zoom in on the daily chart to find our entries. On the daily chart, if I'm looking to short the stock, I would wait for the stock to retest the downtrend on the daily chart, which aligns with the weekly downtrend. For a short entry, I would look for the stock to reach around 320, or I would wait for a breakdown of the $300 key level.

Stocks don't crack key levels right away. Typically, they will test the key level, bounce, and then crack again. As a swing trader, I prefer to wait for the stock to consolidate around a key level, like $300, and make a lower high before breaking down again. That would be an ideal entry.

For example, on the daily chart, the stock retested the key level multiple times before finally breaking down. This is what you want to look for when swing trading.

Step 3: Planning Your Risk/Reward

In swing trading, we generally aim for at least a 1:3 risk/reward ratio. For example, if we’re risking $1, we want to see the potential for making $3 or more. Let’s say I enter a short position at $320; my risk needs to be set at a level like $323 (previous resistance). This would give a 3-4 point risk, but the potential downside could be much greater—down to $300 or even lower. This larger reward makes it worth the wider risk.

If I enter at $320, my risk might be $6 (to around $307), but the reward could be $18 if the stock moves down to $280. So, you need to know your risk and whether the reward is worth it.

Step 4: Know Your Fundamentals

In day trading, some traders can trade without knowing the fundamentals or the news about a stock, and that’s fine. However, in swing trading, understanding the fundamentals is more important, especially if you plan to hold a stock for weeks or months. You need to be aware of earnings reports, news such as FDA approvals for biotech companies, or other significant events.

I once learned this lesson the hard way while swing trading a biotech stock—without doing proper research, I ended up holding a stock that dropped 50% because one of its drug trials failed. This is why I almost never swing trade micro-cap stocks. If you’re swing trading ETFs that track indices like the QQQ or SPY, your exposure to specific stock news is lower, but you're still exposed to the macro environment.

If you're interested in learning more advanced swing trading strategies, check out the Humble Trader Community below, or comment on what you’d like me to cover in future videos. I read every single comment, whether it’s about day trading or swing trading, and I appreciate each one of you who has subscribed and smashed the like button.