How Many Swing Trades Should You Make A Week?

Swing trading is the art of buying or shorting stocks following the swings of a stock. Swing trades can last from a few days to a few weeks.

Some traders will buy a stock when it becomes oversold and then sell it when it becomes overbought. Some traders will buy the break of downtrend lines and some will short the break of uptrend lines. Some traders will buy a stock that corrects to support and sell them a few days later.

There are so many trading strategies that can help you make a swing trade.

Swing trading is ideal for the person who has a day job and is just dipping his or her foot into the world of trading. You do not need to look at the computer screen the whole day. You can find trading candidates using the daily chart or the 60 min chart and you can take you own sweet time to enter.

Unlike day trades that need constant attention, swing trades offers the best of both worlds. Making money in the stock market without staring at the screen all day.

So how many swing trades should you make a week so that you can profit the most without making yourself overwhelmed?

Short Term, Mid Term And Longer Term Swing Trades

Because swing trading can cover a period from a few days to a few weeks, one can often get confused about the number of swing trades you should make.

Different people will tell you different amount of swing trades you should make a week. But when you choose swing trading strategies that goes against their advice, you may either end up losing out on great opportunities or over trading.

That is why you should first of all determine whether your type of swing trading is the shorter term swing trade or the mid term swing trade or the longer term swing trade.

  • A shorter term swing trade lasts less than 3 days (Category A)
  • A mid term swing trade last more than 3 days but less than 7 trading days (Category B)
  • A longer term swing trade last more than 7 trading days but less then 3 weeks (Category C)

Now that we have separated the type of swing trades into 3 different categories, we can now easily determine what is the optimum amount of trades we should take a week.

Category A : Less Than 3 Days

This kind of swing trade are those that you will enter today and exit tomorrow. It is like a guerrilla type of trading. Go in, go out. An example would be buying a stock when it is oversold in the 60 min chart. When the stock is oversold and drops to support, you can buy it and hold it for a day or two. 

Since you will be closing out your position in day 2 or 3 then you can initiate more positions in a week. A comfortable amount will be 2-3 trades a day. So in one week you will be making anywhere from 10 to 15 of these kind of swing trades. But do remember that at any given time, your open positions will be around 5 - 10 since you will be closing out earlier positions as you enter new ones.

I believe that this is still manageable without clouding your judgment. Some trades will be trend trading trades and you can keep them open longer to ride the wave up. To keep yourself from being confused, you should separate your open positions into 2 groups.

The first group are the trades that you just entered and the second group are those trades that have been running for a while but you are still riding the trend up.

Pay more attention to the first group.

For the second group, you might have already taken some of the position off the table as it rises. Perhaps you sold 1/2 when the stock reach a target price. But you are keeping another 1/2 because the stock is so strong and it continues to go up more.

Assuming that is the situation, you can raise your stop loss to breakeven. You can even raise the stop loss higher into profitable territory as the stock continues to trend up.

Category B : More Than 3 Days Less Than 7 Days

In this category, I consider the trades within this period to be the purest type of swing trades. Typical swings happen between 3 to 7 days in the market. Any extension is a continuation of a primary trend. It is not uncommon to see a swing trade turn into a 3 month ride up in the stock.

Yes, stocks can and will often trend higher for a long period of time. This is especially true if the stock is experiencing a correction after a new high. The trader can buy the dip and then find himself riding a powerful stock that trends higher for weeks.

Since the amount of holding days is slightly longer than Category A, then it makes sense to trade a little bit less. 3 to 5 trades a week will be the optimum amount for traders.

Category C : More Than 7 Days Less Than 3 Weeks

This kind of swing trades almost borders into position trades. However, they still do not extend into the way you treat a position trade. You still need to look at them everyday compared to position trades where you do not need to look at them everyday.

Since this kind of swing trades will have larger price moves, you can input more money into each trade. Therefore you do not need as many trades compared to the first two categories.

I would say that 1 or 2 specially chosen trades will be enough per week.

How Many Trades Can You Handle Without Confusing Yourself?

The above is just a rough guideline on how to manage your trades.

I think the most important thing that you need to know is this...how many trades can you handle without confusing yourself? Having 20 open positions at one time can be very confusing at times.

When the market rises, you will be making money on most of them. But what happens when the market falls? You will be confused to which one you should hold and which one you should sell.

After you have sold everything out of fear, you realized that 1/2 of them actually go up more. Too many positions will cloud your judgment. You do not know which positions you should have more patience with.

Try and experiment with the amount of trades that you are comfortable with. The optimum amount will be the amount that helps you to grow your account without stressing you out.

Limiting The Amount Of Open Positions

To avoid over trading and making yourself confused, you might want to make a rule to limit the amount of open positions you have at any given time.

Perhaps you should limit your amount to 7 open positions. If you have itchy fingers and want to trade more, you have to sell 1 position before you open a new one.

This will help you to be focused and patient with your trades.

Conclusion

Hope this helps with your trading. Always remember, when you are not sure go slow. When you are new, reduce the number of trades you make a week. By growing slowly you will grow steadily.

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