Trading Lab 101 · Lesson 2

Swing Trading – Riding the Larger Move

Learn how swing traders use higher timeframe structure and clear risk-to-reward to ride multi-day moves instead of intraday noise.

Lesson Overview +

In Lesson 2, learners move from intraday speed to multi-day structure. Swing traders hold positions for several days to several weeks, aiming to capture a larger chunk of a trend instead of second-by-second moves. They care deeply about the bigger picture: daily trends, key levels, and risk-to-reward ratios that make holding overnight worth it.

Using a higher timeframe chart, learners study how price pulls back into support, how volume and context confirm the trend, and how stop placement and target selection define the entire trade before entry. The goal is to see swing trading as a slower, more deliberate design problem: Where is the structure? Where is risk controlled? Where is the asymmetric reward?

Lesson Video – Swing Trading Walkthrough

Full Lesson Text +

Informational Text – What Is Swing Trading?

Swing trading is a strategy where traders hold positions for more than one day but usually less than a few weeks. Instead of trying to capture every small movement inside the day, swing traders focus on the bigger “swings” of price – the parts of a trend where price moves from one area of value to another.

Swing traders often base their decisions on the daily chart and 4-hour chart, using lower timeframes only to refine entries. They look for clear structure: higher highs and higher lows in an uptrend, or lower highs and lower lows in a downtrend. They define risk in advance, place stops at levels that would prove their idea wrong, and aim for targets that offer a strong risk-to-reward ratio – often 2:1 or better.

Scenario Example – Buying a Pullback in an Uptrend

Imagine a stock has been in a clear uptrend on the daily chart, making higher highs and higher lows. After a strong move up, price pulls back toward a prior support zone that also lines up with a moving average and a volume shelf. Volume decreases on the pullback, then increases again as buyers step in.

A swing trader plans to enter near support, place a stop below the recent swing low, and target the prior high or an extension beyond it. The trade is designed to risk a small, defined amount for the potential of a larger, structured gain.

Process Summary – A Simple Swing Trading Workflow

Identify trend and structure on the higher timeframe (daily / 4-hour).
Mark key support and resistance levels and areas of value.
Wait for price to pull back into a favorable zone that matches your thesis.
Define entry, stop, and target before taking the trade.
Manage the trade over several days using rules, not emotion.

Vocabulary & Functional Definitions

Trend – The general direction of price over a series of swings (up, down, or sideways).
Support & Resistance – Areas where price has repeatedly bounced or stalled; used as key decision zones.
Risk-to-Reward Ratio – A comparison between how much you are risking and how much you aim to make; for example, risking $1 to make $3 is a 1:3 ratio.
Pullback – A temporary move against the trend that can offer a better entry before the trend continues.
Swing High / Swing Low – Local peaks and valleys in price that help define structure and stop placement.

Lesson Flow – How the Session Unfolds

Learning Target: I can design a swing trade by reading trend, planning risk, and selecting targets on a higher timeframe chart.

Bell Ringer: Students decide whether a given chart is trending up, trending down, or moving sideways and justify their choice.

Mini-Lesson: The instructor introduces trend structure, pullbacks, and risk-to-reward using a clean example chart.

Guided Practice: Together, students mark trend direction, support, resistance, and a possible swing entry with defined stop and target.

Independent Practice: Students use the activity panel below to design their own swing trade plan, writing clear rules for Structure & Trend, Entry Zone, Stop Placement, Target Logic, Trade Management, and Reflection.

Closure: Learners share how swing trading changes the feeling of time and patience compared to day trading.

ADTL Mapping

How Lesson 2 Lives in the ADTL

Click a phase or the Mastery pill to see how Swing Trading is expressed through the Aletheian Design Theory of Learning.

Aletheian Design Theory

Trading Lab 101 · Lesson 2 Activity

Design a Swing Trade from Structure to Target

Use a higher timeframe chart to build a full swing-trade plan: structure, entry, stop, target, management, and reflection. Then submit your work directly from this page.

Imagine you are tracking a stock that has been trending for several weeks. It pulls back into a zone you’ve marked in advance. Use the panels below to design your swing trade. When you are finished, generate your summary, optionally print/save a copy, and submit your work to your instructor.

Student Name

Email / Username

Class / Section

1. Structure & Trend +

How is price moving on the higher timeframe?

2. Entry Zone +

Where will you enter and why is this a good area of value?

3. Stop Placement +

Where is your stop and what would prove this idea wrong?

4. Target Logic +

Where will you take profits and how does risk-to-reward look?

5. Trade Management +

How will you manage the trade over several days?

6. Reflection +

How does this swing plan feel different from a day trade?

Generated Summary (copy, print, or save):

Mastery Check

Fill in all six sections with thoughtful responses. When everything is complete, this badge will glow to indicate that you’ve built a complete, structured swing trading plan.