 01/04/2021 Hours or Years, The Different Ways to Swing Trade ✔️ Why different trades need different plans — and my two main swing strategies... ✔️ How swing trades can have a wide range of time frames and how to prep for that...  I just finished the best year of my career so far. My profits are in the mid-seven-figure range.* I'm super excited about what 2021 has in store.
In reviewing my 2020 trades, you may notice something about my trades. Some played out very quickly — others took a long time.
I've got two distinct styles when it comes to trading stocks.
The first I refer to as a swing trade — though both styles are technically swing trading.
The second I refer to as a chart trade. I'll explain the difference in just a bit.
The important thing I want you to learn today is that not every stock trades the same. What works for one won't always work for another.
Let's start at the beginning. I'll explain what a swing trade is, then I'll give you some of the details that make up my two styles. Sponsored Ad  This little-known pattern isn't a "secret"…
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What Is a Swing Trade?
A swing trade is a trade that takes longer than a day to play out.
Any stock bought and sold on the same day is a day trade. If you hold the position overnight it's now a swing trade.
There's no clearly defined maximum hold time for a swing trade. Some could be held for weeks, and others, months. A swing trade could even last longer than a year. It's not common, but it happens.
If you hold a trade for more than a year, some might consider you to be an investor. But there's an important difference.
An investment is a long-term hold — you're in it for the long haul.
I stay in trades as long as it takes for my thesis to play out. If the trade works, I'll take profits. And if it fails I'll cut my losses.
So for my purposes, any trade that lasts longer than one day where I stick to a set of rules is considered a swing trade. Even if it takes more than two years to play out. I'll give you an example in a bit.
From there, I'll share my two types of trades: I call one a swing and the other a chart trade. The Super Swing Trade
My most successful swing trades take time to play out.*
These stocks are typically in new or emerging technology. The business has the potential to disrupt a large industry or solve a major problem.
Over my 20+ years of trading, I've been able to find some of the hottest stocks before they get discovered.
In 2020, I was buying Beam Global (NASDAQ: BEEM) the $10s. Just last week it was trading above $70.
Another example is DermTech, Inc. (NASDAQ: DMTK). I started buying this one in the middle of 2019 between $5 and $7. It hit $35 in late December 2020.
Both these trades are perfect examples of stocks that took time.
Beam Global provides a solution for the electric vehicle industry. It's a truly disruptive technology. Its product is a charging station that uses solar power and battery storage.
Dermatech has a rapid skin cancer detection test. The test is done without a biopsy and can help rule out certain types of cancer.
Both of these companies solve big problems. And both have the potential to disrupt the fields they're in.
But they both were trading at a low price without much volume for a long time. So I had to wait it out. I bought in cheap and built my positions over time.
This type of trade is what I refer to as my swing trades. They often take weeks, months, or even a year to play out. In the case of DMTK, it took nearly two years for more traders and investors to discover this stock.
My other type of trade moves much faster... Sponsored Ad  I did it again!
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Swinging a Chart Trade
When I refer to a trade as a chart trade, that means I'm not likely to hold very long.
My longer-term swing trades can take a while to play out. Often, the companies haven't been discovered by the market yet.
Chart trades are the opposite. The market has already discovered these stocks, and they're on the move.
I have some definitive rules that I use to guide me on these trades. I use moving averages to set stops and profit targets.
Often momentum can carry these stocks very high very fast. So it's important on a chart trade that you lock in profits when a trade does work. And you must cut losses if it doesn't work.
A chart trade isn't nearly as forgiving as my swing trades can be. That's why it's important to always follow rules. Rules Always Apply
Regardless of which type of swing trade I'm in, one thing remains constant. I always have a set of rules.
Swing trades tend to move sideways for weeks or months. So the odds of a big drop are typically minimal. But if the price starts to fall I'll cut my losses.
I can be wrong on any trade. Even though I've been able to find some incredible trades, I'm not 100% accurate.
And for me, chart trades have a stricter set of rules. The time frame these trades play out in is typically less than a month.
Last year I had one trade with Applied UV, Inc. (NASDAQ: AUVI) that moved so fast it became a day trade. I bought in the $6s thinking it could move up over the next week or two. But the stock price doubled to $12 in a few hours.
My goals were met so I cash out a hefty profit, more than $100K in just a few hours.* Sponsored Ad You need to throw out all the rules that small
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 Learn One Trade at a Time
Trading can be a very difficult skill to learn. I've seen people try to learn three different setups at once. Only usually none of them end up working.
Trading takes time to master. So like learning any other skill, start with the basics. Start with a single setup and practice it.
Set up a trading plan with a stop if you're wrong and a profit target if you're right. Trade small or paper trade until you get consistent at that one setup.
Once you master the basics of one setup, size up slowly. Don't get in a hurry. The market's not going anywhere. There will always be another hot sector and another hot stock.
After you've got that first setup down, you can start to learn a second setup. The foundation you build learning the first setup can help you learn the next setup faster.
The better you become at following rules, the better trader you'll become. Keep It Simple
You need to find the trading style that works for you. I don't think you need 20 setups to be a self-sufficient trader.
I've been swing trading for over 20 years. I still have the most success with the two setups I just told you about.*
I believe this to be true in life, in business, and in trading. It's better to be great at one or two things than to be mediocre at a bunch of things.
Master one thing at a time. Don't get in a hurry. And don't try to take any shortcuts.
One trade at a time,
Paul Scolardi Editor, Swing Trade Millionaires P.S. Tim Sykes wants to show you his number number one trading pattern. The same one that he's used his entire career. It's all based on low priced stocks… and it's got the potential to change the way you trade forever.
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*Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here.
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