All You Have To Know About Cryptocurrency Swing Trading

Cryptocurrency swing trading is different from day trading in that you hold your position on altcoins for longer than a singular day, and don’t close your position when the day is over. This means there is an inherent risk of making a loss while you’re sleeping and cannot take action. However, swing trading is and remains the best-known way to maximize your return on investment. As with anything cryptocurrency related, there are risks and advantages to swing trading crypto.

What is Cryptocurrency Swing Trading?

What is Cryptocurrency Swing Trading?

Crypto swing trading usually happens over a period of a few weeks to a few days and utilizes the technique of technical analysis to predict the market. Technical analysis is the analysis of price trends and patterns through the use of indicators such as Bollinger bands or relative strength index.

We have an article on technical indicators if you want to go more in-depth about how they are used in cryptocurrency trading.

Some crypto traders might also use fundamental analysis which concentrates more on competitors and assets etc. 

The method of crypto swing trading can be applied to different kinds of coins, from extremely volatile to more stable, and can be done over a period of days, weeks or months. Just as long as the trade takes place over a period of more than a single day, this is day trading. The goal of a swing trade is to catch a big chunk of a price move and usually done with smaller amounts of cryptocurrency than day trading. The most important part of crypto swing trading is timing. 

In this article, I will be taking you through some important rules to keep in mind while swing trading, how to choose when to move into a position, and how to find the right cryptocurrency to trade in. 

Strategies For Successful Crypto Swing Trading 

Crypto Swing Trading Strategy

One of the most important things for a swing trader to do first and foremost is to have at least a basic understanding of fundamental or technical analysis. You need to know what you’re buying since this form of trading isn’t a matter of hours or a day, but instead weeks or months. Since there could be red flags that you might just miss without proper due diligence. 

You should look at a few different projects using a blend of technical and fundamental analysis to weed out the most promising. What you should be searching for is an altcoin that has been high, has fallen by a considerable amount, and is now on a steady uptrend or has been flat for a long time. The longer a coin has been trending upward or remaining flat the better. If you find a project that meets these criteria, you might have struck gold, and be looking at a great investment opportunity. 

Trade Smaller Sizes To Reduce Overnight Risk

One of the inherent risks of crypto swing trading is your overnight risk. It’s impossible to be glued to your laptop 24/7 to take action in the event a trade goes against you, but there are things you can definitely do to reduce your risk.

Trade in smaller sizes. Day trading results in smaller movement of prices and therefore people are usually prepared to trade much larger amounts, swing trading should be the opposite. 

Don’t Overdo It On The Indicators

Though it is important to be using technical and fundamental analysis to figure out where a good investment opportunity is, definitely try not to use too many indicators at once. Remember, the best traders don’t rely on indicators as the reason to make a trade and don’t use more than 2 or 3. 

Watch Price Trends Very Closely

Since crypto trading happens over a longer period of time and allows for a larger price change, it can result in huge rewards. But, if the market doesn’t favor you, it can also result in a gigantic loss. That’s why you should always keep an eagle eye on any fluctuations. 

Something you should keep in mind is the impact other altcoins and especially Bitcoin can have on the price movement of your investment. When Bitcoin is on an uptrend, altcoins will tend to follow, and good opportunities for buying can come around when Bitcoin is more stable. It can definitely pay to keep an eye on Bitcoin when looking for good investments. 

The 20% price change rule

This rule applies to most trades and is basically to take your win and run if your altcoin increases by around 20%. Since this is already a great profit to make on your investment, and it’s very likely that your altcoin will start dropping the next day by at least 10% if not more. 

Never, ever open a trade without including a stop-loss option to minimize your losses in the event of a trade gone wrong. You will need to do in-depth research on which stop-loss to use for which trades, as doing it wrong could not only result in the failure to prevent losses but might even magnify them. 

There are 3 different kinds of stop-loss strategies including full, partial, and trailing stop loss. You still need a good understanding and prediction of the price changes of your coin to make the right decision for your crypto stop-loss strategy. 


If you have invested in altcoin and there is a scheduled announcement coming up, whether that be a new project launch or a change of operations you should always sell at least one day beforehand. This announcement could cause your price to plummet, and increase your risk. 

The Benefits Of Crypto Swing Trading

Here is one of the best YouTube tutorials on crypto swing trading!

With every investment strategy comes benefits and risks. There’s no right or wrong method and it comes down to the time you have, your budget, and a multitude of other factors to decide what’s right for you. 

Some of the benefits of crypto swing trading include it’s easy to automate. There are countless tutorials and crypto swing bots out there to help you along the process of opening multiple trades at once to expand your portfolio. Plenty of new software is coming out every year to expand the possibilities of swing trading, and the community is only growing. And with more trades, comes more potential for gain.

Looking for a reliable crypto swing trading bot? Look no further than Cryptohopper!

Unlike traditional stock trading, it can take you a matter of minutes to close a position and open a new one. If one trade doesn’t work out, you can be onto the next just like that. Meaning that it can be easier to keep up with trends and catch an upturn when it happens. 

The Risks Of Crypto Swing Trading

The Risks Of Crypto Swing Trading

Some of the risks of crypto swing trading also apply to any crypto trading, there is a huge potential for loss. It is almost impossible to make money with every trade, and if the stakes are too high many beginner and intermediate traders learn the hard way. 

Learn about the best ways to earn Bitcoin without mining!

It can be very time-consuming, energy-consuming, and in some cases even sanity consuming to swing trade. This is because it requires you to keep a long term eagle eye on price changes and act accordingly at any given time. It may even take months or weeks of careful watching before you decide to close a position. 

Taxes: even though it is a cryptocurrency, and many regulations have not caught up yet, most governments require you to pay taxes on your profits from a trade. Always be careful to stay up to date with your tax obligations before you open a new position because you might just lose what you are owing and end up in a sticky situation.


There are many benefits to crypto swing trading over other forms of trading like daily. You can automate it, open up multiple trades at once, make bigger profits, and open and close positions directly one after another. 

Do you want to try out crypto swing trading? Register on Phemex for free!

You will need to be careful and selective when choosing an altcoin to invest in, and make use of your fundamental and technical analysis. You should be careful to trade in a smaller volume than you might with daily trading, as there is more opportunity for huge price movement, and always include a stop-loss strategy to minimize loss in the event of a downturn. Remember, always be cautious and do your due diligence when picking your investments.