What's Easier - Swing Trading or Day Trading?

[maxinger]

It’s the opposite. It’s far easier for a competent day trader to predict what the market will do in 10 minutes than 3 months. Short term movements appear random if you don’t know how to read price action.

Your statement that you can predict with a “reasonable degree of accuracy” that a stock will be higher in 3 months if market conditions don’t change. Well how do you predict whether the market conditions will not change in 3 months?

those who don't know how to day trade tend to blame it on day trading and not self.
those who don't know how to swing trade tend to blame it on swing trading and not self.
etc

 

[Relentless]

Depends on the strategy. There are certain types of trading opportunities that present themselves within the day, though most do not. Based off what I've seen on ET, most are trading noise, whether they are day or swing traders.

I think it's more useful to tie the style to the catalyst. Are you trading mean reversion? Are you providing liquidity? Is there an anomaly you are harvesting? Charts and patterns are ill suited to analyze those opportunities, especially if the chart is just price lol.

Charts and patterns do work. Most won't put in the time / effort required.

There's more than one way to skin a cat.

 

[longandshort]

Charts and patterns do work. Most won't put in the time / effort required.

There's more than one way to skin a cat.

Disagree.. the time and effort is to actually analyze the company not it’s time series data lol. That’s the easy part.

 

[Relentless]

Disagree.. the time and effort is to actually analyze the company not it’s time series data lol. That’s the easy part.

Not sure what to tell you. Proof of concept says you are flat out wrong.

But I don't disagree that the approach of analyzing a company is good as well - but i do that as more of a longer term approach.

 

[longandshort]

Not sure what to tell you. Proof of concept says you are flat out wrong.

But I don't disagree that the approach of analyzing a company is good as well - but i do that as more of a longer term approach.

Let’s put it this way. There are some strategies that can harvest the returns derived from illiquidity, liquidity provisioning, and variants of the momentum factor intraday. Those strategies require expert knowledge of market structure, liquidity, and flow to be successful. No one running those strategies uses a chart and patterns.

If you did a study on price returns you would find that the majority of +1std moves in daily prices are due to catalysts — either once information is revealed or positioning prior to that. So in order to trade those successfully the hard work is in analyzing the catalyst and what you expect the impact to be on price. (View -> expressed financially in terms of rev/costs/or fcf -> estimated impact to price -> compare to price reaction and volume = trading signal).

Daily fluctuations within 1std are really just noise as the price is driven by the limit order book and at the market volumes. Unless you have an edge on measuring flow and the limit order book (which is not data represented in charts and patterns) you won’t be able to successfully position. If you’re just a hobbyist then obviously do what you want to do, but if you’re trying to generate alpha and compete, then I’d suggest reconsidering your approach.

FYI- I have a professional background (multiple licenses, worked at I-banks and hedge funds).

 

[KCalhoun]

Let’s put it this way. There are some strategies that can harvest the returns derived from illiquidity, liquidity provisioning, and variants of the momentum factor intraday. Those strategies require expert knowledge of market structure, liquidity, and flow to be successful. No one running those strategies uses a chart and patterns.

If you did a study on price returns you would find that the majority of +1std moves in daily prices are due to catalysts — either once information is revealed or positioning prior to that. So in order to trade those successfully the hard work is in analyzing the catalyst and what you expect the impact to be on price. (View -> expressed financially in terms of rev/costs/or fcf -> estimated impact to price -> compare to price reaction and volume = trading signal).

Daily fluctuations within 1std are really just noise as the price is driven by the limit order book and at the market volumes. Unless you have an edge on measuring flow and the limit order book (which is not data represented in charts and patterns) you won’t be able to successfully position. If you’re just a hobbyist then obviously do what you want to do, but if you’re trying to generate alpha and compete, then I’d suggest reconsidering your approach.

FYI- I have a professional background (multiple licenses, worked at I-banks and hedge funds).

Brilliant observations. Completely agree re +1std insights. Much of how I trade uses that type of thinking.

I look for range-related moves, outliers etc

 

[syammondsandrew]

Everything lies in interests. If you are interested in day trading, you’ll find it easier. Day trading is when you open and close a trade in one day and swing trading is for a little long term.

 

[d08]

Numerous published studies reveal the more actively an acct is traded, the worse the performance. Obviously there is a small percentage that are the exception.

Day trading your more likely to give into impulse & have the flight or fight responses on overdrive which sabotages your logic & best laid plans.

I do both day & swing - not biased, just keepin it real.

I think there's another factor in these studies. The gambler types are attracted to shorter time-frames because it gives a dopamine rush. Holding a position for weeks without watching it daily does not. So the losing gambler types skew the data.

 

[d08]

Jeez, what market are you trading?

And of course daytraders who are successful will be able to do what you say. Or else they will not be successful. So it's rose-colored glasses man.

What if I told you that the most competent daytraders will know what the "market" is going to do in the next 60 seconds, based on PA? How would you respond to that? Time-frame not long enough? Mmm hmm.

The most successful traders in the world are people who buy and hold. If you buy a stock like AMZN, are you a trader or an investor? If you buy and sell AMZN within the same day, you have traded it. If you buy and sell AMZN withing 30 years, it WAS a trade. So why is that not trading?

Maybe we should start calling it "dayinvesting"?

I think you're only here for entertainment and you don't trade but in any case...

60 seconds can be too short because you're paying the spread/slippage/commission, so the instrument has to be very volatile but also with relatively tight spreads.

Most successful investors in the world buy and hold, traders don't do that.

 

[murray t turtle]

Brilliant observations. Completely agree re +1std insights. Much of how I trade uses that type of thinking.

I look for range-related moves, outliers etc

%%
SAME here;
except markets are much more complex than skinning any cat/LOL. But to be flat out blunt\ i study+ trade trends /invest trends> more than ranges............................................