Day Trading the Same Instrument You Already have a Swing Trade On

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Video Transcription:

Hello, traders. Welcome to the Pro-Trading Course and the fourth module, “Day Trades and Short-term Trades.” In this lesson, we are going to review why it is possible to day trade the same instrument you already have a swing trade on. And, well the reason we need to have this lesson is because I need you guys to understand that just because you have a swing trader or an instrument, it doesn’t mean that you have to take the eye off of it on a daily basis. We are going to go back again to the US dollar/Canadian dollar, and now we are going to assume that we have a short entry right here. Okay?

Day trading on a Swing Trade position
Now, I am going to guide you through what’s going on in my head right now. What we have here is a very strong down move on the US dollar/Canadian dollar. I am going to show you. We have been in a very strong down move since we made a highs of around 46.93. And now we are trying to get on that swing trade, on that move to the down side. So what we are waiting for is a retest of these zones, of course. And you already know how swing trades are made, right? Now what we are going to do here is we are going to go short around the 32.69 level. And we are going to…well, I’m going to show you right now where the targets are going to go.

Our targets…let me go to the US dollar/Canadian dollar for our chart, all right? Price is right here, or bounce right here at the 28.34 level. And it bounced right here because it is a very strong level of support, it has been tested once, twice, and three times. And it’s kind of bull/bear area, all right? But we do have another zone that can be tested which is the 25.61 which is our ultimate target. And we are short from these highs, the 32.21. We are going to go right here, and this is the highs where we are short.

Day trading on a Swing Trade position1

And we took the short trade, which by the time it hit the first target right here, was in the money for 360 peeps. So I’m going to put on the first targets of our trade right here. But what happened is that we came onto a zone where we are going to find buyers and we already know that. We already know that we are going to find buyers. And the thing is that because we know we’re going to find buyers, there was a great opportunity to buy here a bounce to this area or to this previous area of resistance. And we do so, so we enter long here while we are still short on the overall trade, because we are still targeting lower levels. But, that doesn’t mean that we cannot profit from the retracement back before we move forward, we move lower.

Day trading on a Swing Trade position2

So what happened here is that we took half of our position here and move ourselves to break-even. When we move ourselves to break-even, we but the bounce of this area that we already analyzed heavily on this module and we made a 150 pips while still being short. Now what we’re going to wait here is just a bounce-off of this area of resistance, the weekly pivot, and the 76.4 from this high to this low, or the 76.4 from the move that we are short in.

Day trading on a Swing Trade position3

Now, because we are swing trading, we don’t mind to have such a deep retracement of 76.4% or 320 pips. Because we are swing trading and we already took half of our position at 363 pips and we already took 150 pips from the day trade, we don’t mind a deep retracement. But what’s going to happen is that price might bounce off the weekly pivot of 76.4 retracement and of course this heavy area of resistance and continue to the down side, which it started to do right now. So if you are swing trading an instrument, you can always have day trade ideas as long as the two entries are not too close together.

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