How to Swing Trade Forex with Price Action Analysis. Strategy for Beginners
- VasilyTrader
- Aug 4
- 2 min read
If you just started swing trading and you don't know what strategy to trade, I will show you how to use basic price action analysis for predicting swing movements in Forex.
Take notes and learn a simple strategy for beginners.
Swing Trading Basics
Let's start by discussing simple price models that will help you understand how swing trading works.
This price model represents swing moves in an uptrend.
Your goal as a swing trader is to try to predict the completion of a corrective movement after each swing up.
A corrective bearish movement represents a minor downtrend.
A breakout of the lowest resistance is a strong signal to buy.
That reliably confirms the completion of a correction.
The same model works in a downtrend.
To accurately swing buy the market, we need to accurately predict the completion of a correction after each swing down.
A corrective bullish movement represents a minor uptrend.
A breakout of the highest support is a strong signal to sell.
That accurately confirms the completion of a correction.
Swing Trading Strategy
Now let me show you how to use this model in practice.
Look at the price action on EURUSD on a daily time frame.
The market is trading in a downtrend.
After each swing down, a correction follows.
Every time a bearish violation of the highest horizontal support in a correction was a strong signal.
Another swing down movement followed then.
As you can see, EURUSD is currently in a correction.
Let me explain how I will trade that.
We simply need to find the highest horizontal support in this correction.
Our signal will be its breakout and a daily candle close below.
We can set our sell limit order on its retest, then open the trade immediately after a candle closes.
Stop loss will be above the last high in a correction.
Take profit will be the next historic support.
That will be your simple step-by-step trading plan to follow.
The same logic will be used in an uptrend.
Just make sure that the market is in a trend and strictly wait for a correction first.
Then wait for a breakout as your confirmation.
If you are a beginner in Forex, this will be the easiest yet most reliable strategy for you to follow. You just need to learn basic price action analysis to trade it effectively.
