As a popular trading strategy, swing trading allows you to take advantage of an asset's price swings over a short time frame. Now, trading in general has both ups and downs. But at times, even small-scale activities in the trading world can expose you to great investment returns, especially in the highly volatile and unpredictable cryptocurrency market.
Now, here's where swing trading crypto helps! By making quicker decisions, you can gain profits through short and medium-term trading activities.
The major question now is — how does swing trading in cryptocurrency work? To help you, this detailed article will thoroughly take you through all the ins and outs of swing trading in the crypto market.
What is Swing Trading in Crypto?
Swing trading focuses on purchasing and selling crypto relatively quickly, ranging from days to weeks. The profits in swing trading lie in the price shifts or 'swings.' Using technical analysis, you can decide when to buy or sell a cryptocurrency to make quick returns from these price swings.

However, swing trading, like any other sort of trading, has risks, particularly the risk of overnight price changes. While you switch off your screen at night, with plans to resume your trading the next day, the value of your assets could take a sharp dive overnight.
How Is Swing Trading Different From Long-Term Investment?
Long-term crypto investments are different from swing trading. You can refer to the table below to explore some basic differences between the two:
Header | Swing Trading | Long-Term Investments |
---|---|---|
Holding Duration | Cryptocurrencies are held for days or weeks. | Cryptocurrencies are held for months. |
Trading Opportunities | You ignore long-term profit potential to make quick money. | You miss short-term profit opportunities and must wait a long period to generate larger profit from your investments. |
Market and Crypto Asset Understanding | Swing trading crypto assets requires only the analysis of real-time hourly or daily price movements and market activity. | Understanding the crypto asset's history, development potential, and risks is essential to making wise, profitable long-term investments. |
Profit Flow | You can seek profits by trading crypto frequently and in smaller amounts. | The profits in long-term investment can be slow and steady. |
Time Required | Swing trading requires a lot more time dedicated to watching the charts. However, this is more thrilling as you stay engaged, looking for opportunities to buy and sell crypto. | Long-term investment doesn’t require much time at all, although some may find this boring. It allows you to invest and ride out the volatility while waiting for long-term profitability from your coins. |
Participation in the Market | This trading approach requires you to watch every little movement of crypto assets to make the right decision at the right time before the next price movement begins. | You don’t have to be active in the crypto market at all times and monitor every little movement of your crypto asset. |
Considering the table above, long-term investments in cryptocurrency involve keeping your holdings for months to years. While it is less risky — since you don't have to make instant trading decisions — long-term investments aren’t perfect either.
The biggest downside is you have to wait for quite a while to trade your cryptocurrencies. It also comes with the drawback of missing out on great investment opportunities while holding a certain cryptocurrency for the long run.
Furthermore, understanding a cryptocurrency's market worth and long-term growth potential is essential for profiting from long-term investments. Without it, you risk investing in a sinking ship.
Swing trading crypto, on the other hand, allows you to make profitable trading decisions by assessing a crypto asset's short-term potential and movements on that specific day.
Pros of Swing Trading Cryptocurrency
According to our research, some potential benefits you can explore through swing trading in the crypto market include the following:
Cons of Swing Trading
Some risks and drawbacks that come along with swing trading in the crypto market include:
Key Strategies for Swing Trading Crypto

Below are some strategies implemented by the best swing traders in the crypto world:
Reversal Strategy
The reversal swing trading strategy emphasizes looking for changes in price momentum to anticipate a change in market trends. For instance, assume Ether (ETH) has been on an upward trend until it shows reversal signals. In this regard, swing traders can sell their ETH assets if the price falls below the support level.
From what we found, some common technical analysis tools and indicators that help traders better implement the reversal strategy include:
Trend Trading
This swing trading method focuses on capitalizing on the market trend, which can be upward, downward, or sideways. For instance, consider an uptrend in Bitcoin’s price. If this uptrend stays for several weeks, trend traders will observe this trend and purchase Bitcoin during this upward movement to capitalize on the gains before the trend ends.

To profit from this trend — traders use tools like trendlines and rectangles that show the trend in a cryptocurrency’s price. Additional technical analysis indicators that can help you make better trend trading decisions include:
Counter-Trend Trading
Counter-trend trading or trading against the trend entails entering a trade when the price is through a slight correction or decline. As an example, consider the uptrend of ETH price for several days. In counter-trend trading, traders spot the signs of a slight pullback in ETH price and use tools to find support levels where its price could bounce back. The traders will buy ETH on this level, expecting a temporary reversal.
For this, swing traders use the Fibonacci retracement tool, a popular tool — and a personal favorite — among technical traders that helps identify strategic places for transactions, target prices, and stop losses. This tool is used with other trading indicators in counter-trend trading, including moving indicators, RSI, MACD, and Bollinger Bands.
Technical Analysis
Technical analysis uses market news and updates to predict market direction. What makes this swing trading strategy impactful is how it lets you use the market direction to determine the precise points at which to join and exit crypto trades. So, for example, a swing trader analyzes Bitcoin’s price chart and notices a strong uptrend amidst the news of BTC’s integration into a major online platform.
This is where the trader analyzes BTC's price patterns, candlestick patterns, indicators, and chart data to determine their entry point in a trade. They look for a retracement to a key support level, anticipating further price rise.

Likewise, when BTC’s price rises to a resistance level, the trader will exit the trade and secure their profits during this upward trend.
Tips for Successful Swing Trading in Crypto

Now that we've covered the fundamentals, let's look at some key techniques — according to our research — for successful swing trading:
Conclusion
Swing trading in the crypto market can be a smart way to bag instant returns. However – despite the short-term benefits – we suggest you carefully analyze the crypto market and the potential risks of trading due to the inherent volatility of cryptocurrencies.
Proper risk management strategies like stop-loss orders, implementing a well-defined trading strategy, and keeping an eye on BTC and other crypto market movements can help you prevent potential losses during swing trading. To further strengthen your trading game and ensure long-term sustainability in swing trading, we suggest you go through our free crypto trading course. If you are looking for a crypto exchange to start swing trading, we suggest looking at this article of the best trading platforms.
We hope this detailed article answers all your questions about swing trading crypto, and prepares you to make some great trades, and large profits.