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Instead, they reach a level of income they are comfortable with and then they stay there. For a day trader it may be $1,000/day, and for a swing trader it may be $5,000 or $12,000 or $60,000 per month. Each trader has a different level where they feel comfortable.

This swing trading strategy requires that you identify a stock that's displaying a strong trend and is trading within a channel. If you have plotted a channel around a bearish trend on a stock chart, you would consider opening a sell position when the price bounces down off the top line of the channel.

As I will show, even with keeping risk low (1% or less per trade) you can earn a solid income from swing trading. ... During your initial year swing trading, don't expect to make these types of returns; you will very likely lose money in your first 6 months to a year.

As a general rule you will need at least $5,000 to $10,000 to swing trade stocks effectively. It is recommended you deposit more than the minimum, because if you deposit the bare minimum a few losing trades will put you below the recommend account balance.

In addition, day trading strategies are much more sensible to slippage and other transactional costs, since they generally have a quite small average trade. So, for most people, the short answer is that swing trading is the more profitable option!

Swing trading can definitely make you rich. With an average annual return of around 30%, you would double your capital every three years, which will grow to huge amounts over time. Warren Buffet, the famous investor often dubbed the oracle of Omaha , has built his fortune by achieving returns of around 20% annually.

Swing trade only in the very best stocks. These stocks are undervalued by the market and growing earnings strongly and reasonably safely. ... The stock should be trending upwards strongly. ... The overall market should be positive and trending upwards. ... Money Management and position sizing are critical to success.

Most swing traders get paid commissions. They earned average annual wages of $84,000, including salaries, commissions and bonuses as of 2014, according to Simply Hired.