Generally speaking, a swing low in trading means that you buy into a trend and expect the price to fall as you continue to buy in. A swing low in trading typically occurs after the beginning of an uptrend in the underlying asset. While you can always expect the underlying to be higher, you should still continue to buy as the price continues to rise in order to reap the benefits of the uptrend. For example, a swing low in investing occurs when the price of an ETF rises from the bottom and there is a significant upside potential in the underlying.
Investing in an ETF involves a lot of risk and not all of that risk should be considered in the calculation for a buy or sell decision in the ETF. However, you should know that each ETF will have a range of possible investments depending on your personal, investment and/or portfolio goals (see “What Investors Can Do When Swings in Trading Are a Problem”).
How do I find a swing low?
Find the swing low in a different fashion than using an index and using the average or even the top 10% of the index. It may help to look at the bottom of a range of price movements in the stock or ETF markets. In an example where the stock market has crashed over 60 times and the S&P 500 is trading in the 3200’s, we can see that the stock price will be falling in one direction only. In this example, the market is not being driven higher but instead, the market has been pulled lower. If in this example, if we were to consider the stock in a single category, let’s call it ‘Stock Down (15m)”, we can see that the stock price could go up to $4.50, falling to around $1.30, and going back to $3.60.
What happens with a swing low?
You can make a difference for your city and the entire region by helping to raise money in the 2018 and 2026 Santa Barbara Events Fundraiser.
Santa Barbara Events is a non-profit organization that raises money for local community events, events sponsored by local businesses and organizations, and for Santa Barbara schools and community organizations. Donations are tax-deductible to the extent of your federal income tax-sheltered income.
As a public benefit organization, Santa Barbara Events encourages people — and businesses — to donate as much of their time and money as they can to the causes we support.
Santa Barbara Events is not an