Swing Trading vs Day Trading: What's the Difference? | Espresso

Swing Trading vs. Day Trading

Whether you want to establish yourself in the forex or stock market, you must know basic trading strategies. These are ways to analyze the price action movement based on certain fundamental attributes and ensure maximum profits and lowered risks. However, if you do not understand the trading concepts properly, the risks will increase, and you may trade in loss.

Published on 19 October 2022

The two major trading strategies are day trading and swing trading. Most traders opt for day trading since the position's opening, and closing will happen on the same day. But this does not mean the swing trading method is completely out-ruled. Both day and swing trading concepts are synonymously used to ensure maximum gains. If you are an amateur, start understanding the differences between these two strategies before you implement them.

Keeping this in mind, we have drawn a parallel study between swing and day trading. This will give you the fundamental clarification needed to excel as a trader.

Day Trading and Swing Trading

As the name suggests, day trading is a strategy where the trader buys and sells assets within the same day. In other words, the maximum time duration between the opening and closing is 24 hours. Usually, in this case, traders opt for short positions because, in long positions, day trading cannot yield maximum profits. Plus, the risks are also higher with the long positions in day trading.

Swing trading, on the other hand, aims toward short to medium gains over days. Here, the trader opens the position by buying and holding some assets. With the help of technical analysis, they determine the expected reversal in the trend and choose the ideal sell point to make maximum profit.

Although the profit margin is more for swing traders than for day traders, they are exposed to the risks of gaps where the price suddenly changes when the market is closed or not operative.

Pros and cons of day trading


  1. In day trading, you will be your own master. It means you can open and close the position anytime, provided you do so before the expiry duration of 24 hours. You won't be under the pressure of making huge profits.
  2. Several strategies compatible with day trading include the supply and demand strategy, reversal candlestick pattern analysis, and so on. It means you have more flexibility in choosing the strategy at your convenience.

Iii. The risks associated with day trading are lesser in number. Most traders profit from day trading, regardless of when they close their positions.

Iv. It is easier to track the uptrend and downtrend in day trading because you won't be exposed to the gaps between two price movements. As a result, you will be aware of the price action movement of every instant.

  1. You won't have to worry about the overnight risks when you sleep, and the market will have explosive uptrends or downtrends.


  1. One of the major disadvantages of day trading is the scope. You won't have exposure to long-position trade options. Therefore, you may miss the explosive uptrends and make major profits.
  2. Day trading is a research-intensive process. You need to study the market bit by bit and carefully.

Pros and cons of swing trading


  1. There is no doubt that the profit margin for swing trading is much higher than any other trading option. A trader can easily maximize short-term gains without exposing himself to risks.
  2. The time difference between a swing trade's entry and exit or opening and closing points is much less than other long-term trades. Therefore, traders won't have to invest much time in holding the assets or studying the market.

iii. You can easily use different technical and analytical methods to understand the price action movement and speculate future trends.

  1. One of the major advantages of swing trading is the exposure to price movements for more than a day. Therefore, you can easily close your position when the explosive trend is in your favor.


  1. The biggest disadvantage of swing trading is that you will be exposed to the market gaps caused during weekends and overnights. Most often, reversal happens after such gaps, and you would miss golden opportunities to make profits.
  2. The risks associated with swing trading are much more than day trading, especially because it completely depends on technical analysis. If you fail to analyze the price action movement, you won't be able to make the right call.


Day Trading vs Swing Trading

  • Day trading makes several trades daily whereas swing trading makes multiple trades every week.
  • Day traders place the most transactions possible to maximize their day's profit, but swing traders aim for a significant profit.
  • Day trading uses indications to purchase and sell short-term whereas swing trading makes use of trends & momentum signals
  • Day trading requires less capital and swing trading requires more capital.
  • Day trading utilizes cutting-edge trading tools and platforms, on the other hand, swing trading uses a standard brokerage account.
  • Day trading is comparatively less risky to swing trading


Now that you know the fundamentals of day trading and swing trading, it will be easier to decide which one you want to go with. While doing so, keep your expertise in mind along with the scope and provisions. Also, it would help if you considered the expected profit margin, the risks you can sustain without suffering any major loss, and the past market price action movements.

Chandresh Khona
Team Espresso

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