How to Identify Stocks for Swing Trading?

So, understanding swing trading stocks is the first step to begin swing trading as a trader. But where do you start? How do you find the best stocks for swing trading?

To begin swing trading, you will need to learn a few tricks, thumb rules, and important factors, including high probability strategies for swing trading. Experienced traders pick stocks with extreme care, as this is a major factor in capturing a larger market piece. So, how can you do that too?

You will need to learn how to identify stocks for swing trading. There are quite a few things to keep in mind when choosing a stock to trade. Let’s find out how you can do all these things and make the best decision.

Thumb Rules to Identify Stocks for Swing Trading

Every swing trader has their own set of strategies. But there is still some general rule that applies to everyone. They will help you find the best stocks to trade.

Market direction

Market direction is a very common indication of stocks. A trader believes that a stock will continue to rise if its value is high in the current market. But that is only possible when other market parameters do not change.

You can find market direction in many ways. Browse through stock indices or company news to determine the market trend.


This is a crucial swing trading indicator for traders. Liquidity determines the frequency of swing trading.

As a result, traders can determine the stock demand. And thus, you can start swing trading with those low-risk and high-volume stocks.

Stock performance

Stock performance is the comparison between different stocks. You will need to find the strongest stocks that outperform other stocks.

Correlation and volatility

You will sometimes find stocks that move away from the market trend. They will look very lucrative. But the wisest choice is to stay away from them – this is called stock correlation with the market.

You will also need to look into the stock volatility. Volatility measures the movement of the stock price. This is a significant indication of stock risks and profit possibility.

Clear uptrend

Many swing traders also prefer less jumpy stocks. This means that those stocks have small movements in price. And there are also minimum price line gaps. Thus, you will need to avoid stocks that are prone to sudden pullbacks and selling.

4 Things to Consider When Finding Stocks to Swing Trade

Choosing the right asset for swing trading is vital. You know the things you must use to strategize the selection process. But we still often tend to forget about some more important things.

Here are 4 things a trader must consider when finding stocks to swing trade.

Using chart patterns

You can use chart patterns to identify trading trends in the market. Different chart patterns will have different meanings, providing further indications of the swing trading trend.

The economic calendar

It would help if you also looked into the economic calendar every now and then. It will enable you to keep track of the national economy. As a result, you can invest in profitable stocks with fewer risks.

Earning calendars

Swing trading often faces sudden price movements. You can also keep track of them by using earning calendars. This will help you to prepare feasible strategies to tackle the sudden price movements.

Trading penny stocks

When we talk about penny stocks, we mean to be careful about trading them. This is a kind of stock that is highly speculative. As a result, your investment in such a stock needs to maintain an extremely careful approach.

Penny stocks will be able to bring you huge profits. But this is a very risky stock as well.


Swing trading is always a risky investment for many. There are many other things to consider before diving into the world of swing trading. And one key learning topic is to know how to identify stocks for swing trading.

The identification tips and suggestions provided here will help you prepare the strongest strategies. But you still cannot rely on bookish strategies. You will need to cater your strategy and then mix it with expert suggestions.

After all, knowing about the stock finding processes can save you a lot of trouble. You can expect to survive for a long time if you follow the rules and considerations.