You’ve undoubtedly heard the technical vs. fundamentals argument a million times if you’ve been around the trading block, particularly in the prop company industry. Which one prevails? Which one really counts?
The majority of experienced prop traders will tell you that it’s not a competition. You need both in your toolbox if you want to be a successful swing trader, especially when utilizing a platform like MetaTrader 5 (MT5). The secret is to blend them together seamlessly, not to choose one over the other. What about MT5? That’s what it’s made for.
Let’s talk about how to use MT5 for swing trading by combining technical and fundamental analysis.
Why Swing Trading and MT5 Are a Killer Combo for Prop Traders
Holding deals for a few days to a few weeks is the main goal of swing trading. It is the ideal compromise between long-term investment (too slow, too uncertain for the majority of funded accounts) and scalping (too rapid, too stressful).
Why prop firm traders find swing trading so difficult:
- You refrain from overtrading: Prop businesses often have rigorous drawdowns every day. Swing trading allows you to give your trades some breathing room.
- Better risk-to-reward: You don’t have to keep an eye on every pip in order to target major changes.
- Reducing screen time is ideal for maintaining your sanity since it eliminates the urge to constantly monitor the charts.
- It’s all supported by MT5: Everything a swing trader requires is available on MT5, including comprehensive economic calendars and personalized indicators.
Step 1: Start With the Fundamentals (Don’t Skip This Part)
Some traders like ignoring fundamentals because they believe they are too complicated or sluggish. However, what if you work for a prop firm and swing trade? Ignoring them is not an option for you.
The larger picture is moved by the basics. They provide an explanation for the price movement. And that “why” is more important than you may realize when you’re holding deals for a few days or weeks.
How to Use Fundamentals in MT5
MT5 actually gives you a lot of tools for keeping up with economic news, right inside the platform.
Use the Built-In Economic Calendar
Go to View > Toolbox > Calendar, and bam—you’ve got all the major economic events right there.
Keep an eye on:
- Interest rate decisions (FED, ECB, BOE, etc.)
- CPI data (inflation = big market moves)
- NFP (Non-Farm Payroll) if you trade USD pairs
- GDP reports
As a swing trader, your job is to spot the events that might trigger a multi-day trend. Not every little news blip matters to you—but the big macro stuff? That’s your bread and butter.
Follow Currency Sentiment
Is the Fed hawkish? Is the ECB coming across as dovish? Is the JPY a safe refuge for traders? You may avoid going against the grain by being aware of the prevailing attitude, but you don’t have to become an economist.
For instance, if you’re looking at a long EUR/USD position and the USD is strong overall owing to increasing rates, you might want to take a break. Avoid opposing macro momentum.
Step 2: Zoom Into Technicals – Where the Rubber Meets the Road
The platform’s charting tools are next level. Clean, fast, and fully customizable.
Which Technical Tools Work Best for Swing Trading?
Swing traders don’t need 15 indicators clogging their screens. You want clean charts and tools that help spot momentum, trend direction, and good entry zones.
Here’s a solid toolkit:
🔹 Moving Averages (MA)
Use a combo like:
- 50 EMA for trend direction
- 200 EMA for major support/resistance
- Price above both = bullish bias
- Price below = bearish bias
🔹 RSI (Relative Strength Index)
- Helps identify overbought/oversold conditions
- Great for spotting divergence on swing highs/lows
🔹 Fibonacci Retracement
- For finding pullback levels in trending markets
- 38.2%, 50%, and 61.8% are your best friends
🔹 Support & Resistance Zones
Draw them manually based on weekly/daily charts. These zones act like magnets for price. Combine this with fundamentals and you’ll start seeing those “aha!” moments.
🔹 Candlestick Patterns
- Reversals: Pin bars, engulfing candles
- Continuations: Inside bars, flags
Again, swing traders don’t need tick-by-tick setups. You’re looking for strong confirmation, not scalp signals.
Step 3: Blending the Two – Where the Real Edge Is
Now mixing fundamentals and technicals into a strategy that actually works.
Start With the Narrative (Fundamentals)
Ask yourself: What’s the market story right now?
- Is inflation rising in the U.S.?
- Are central banks getting aggressive?
- Is there political instability in the Eurozone?
Use MT5’s news feed and economic calendar to build your market view. If the USD is strong fundamentally, maybe you want to short weaker currencies like the JPY or NZD.
The narrative gives you context. You don’t trade blindly—you trade with intention.
Confirm With the Charts (Technicals)
Now jump into the technicals. Use your indicators and price action analysis to confirm what the fundamentals are saying.
Let’s say you expect GBP/USD to fall due to weak UK data. On the chart, you see:
- Price is below the 50 and 200 EMAs
- RSI just came out of an overbought zone
- There’s a clean rejection at a weekly resistance level
Boom—you’ve got confluence. That’s your setup.
Find the Entry and Exit
MT5’s multi-timeframe feature helps a lot here.
- Entry: Look at the 4H or daily chart for clean entries
- Stop loss: Use recent swing highs/lows
- Target: Set TP at next support/resistance zone, or use a risk-reward ratio like 1:2
You’re not looking for perfection. You’re looking for probability.
