Out of the three types of short term trading swing trading is proven to be the best. The other are day trading and position trading. When the market becomes volatile the swing trading is very beneficial.

We see that the market price doesn’t move steadily. Sometimes it moves up and down by larger amounts in shorter periods of time. Day trading is meant to maximize profit by exploiting this short time volatility. But as we see that day trading is very risky if the market price doesn’t go up by the end of the day. Then how to exploit these short term volatility in the market?

Strategy

We need to employ a better strategy to exploit this volatility. Most of the investors are driven by greed and fear. That’s why we see lot of fluctuations leading to large divergence in open/high/low/close price of a share. If we pick those stocks, the high/low difference of which is very high and is consistent everyday, then my strategy works best. By picking large high/low difference you can do swing trading even for a short period of time like 2-4 days without the risk associated with day trading. We have capture the lows when buying and highs when selling. It comes with a bit of research on the stocks and little experience in trading.