Swing Trading
This style involves holding a position from one day to several days or, in some cases, even weeks. Swing trading also relies heavily on technical analysis but the fundamental aspect also plays a big role. Within a few days, the market situation can change drastically due to an external event. Therefore, you need to be vigilant and follow the news.
Swing trades have another difference from high-frequency trades. These positions should be closed not only in case of loss but also when the market starts to move sideways. If the price is stuck in a narrow channel, this indicates that the signal has not worked out. Due to the uncertainty in the market, it is better to close the position since the chart can move in any direction afterwards. In this case, it is better to exit the trade with no profit at all than to risk losing money.
Now, about the timing. Let your swing trade work out. If you refer to charts too often, you risk closing the trade prematurely. Not to mention the constant stress caused by neverending monitoring of their positions.
The optimal solution for a swing trader is to check the trades once a day. Choose a time when to do it. The optimal period is the intersection of the European and American trading sessions. At this time, traders are the most active. If the market situation changes in the wrong direction, you will immediately notice it and close the trade on time. A price moving in a narrow corridor also gives a close signal. If the market continues to move in the direction you want, turn off the chart and forget about your trade for another day.
There is no optimal holding time in swing trading. Give your position exactly as much time as it takes to fully work out. When checking your trades, you can move your Stop Loss closer to the current price. This way you can protect the profits you have already made.
Position Trading
This trading style has additional pitfalls. Due to the significant duration of transactions (up to several months), it becomes increasingly difficult for traders to close losing positions. They prefer to hope for a trend reversal as they have to choose between a 100% loss and a possible profit. It does not matter how low this chance is.
It is worth “hoping for the best” only if the unprofitable trade is small. If the trade size is significant, the position should be closed immediately after the market reversal. It is better to re-enter the trade in the desired direction than to wait for the situation to change.
The advice for position trading is the same as for swing trading - check your trades once a day. If the market made a clear reversal or went flat, close your position. If the trade brings profit, let it sit. Don't get hung up on minor price fluctuations. Relax and let your position work out.
The time factor in Forex trading is extremely controversial. Hope the tips in these articles will help you sort out the issue. Good luck.