Junichi Masuda said on the Nintendo Treehouse livestream that you can only transfer Pokemon from the Galar region Pokedex from Pokemon Home to Pokemon Sword & Shield.
He said that this was done out of concern for the balance of Pokemon battles.
Update (June 28, 2019): Masuda published a statement on the official Pokemon website regarding his decision to limit the amount of Pokemon in Sword & Shield:
“Thank you to all of our fans for caring so deeply about Pokémon. Recently, I shared the news that some Pokémon cannot be transferred to Pokémon Sword and Pokémon Shield. I’ve read all your comments and appreciate your love and passion for Pokémon.
Just like all of you, we are passionate about Pokémon and each and every one of them is very important to us. After so many years of developing the Pokémon video games, this was a very difficult decision for me. I’d like to make one thing clear: even if a specific Pokémon is not available in Pokémon Sword and Pokémon Shield, that does not mean it will not appear in future games.
The world of Pokémon continues to evolve. The Galar region offers new Pokémon to encounter, Trainers to battle, and adventures to embark on. We are pouring our hearts into these games, and we hope you will look forward to joining us on this new journey.”
Pokemon Home is a cloud-based storage system that connects to Pokemon Bank (and by extension all the core Pokemon games on the Nintendo 3DS), Pokemon: Let’s Go, Pikachu & Eevee, Pokemon Sword & Shield and Pokemon GO. The service also lets you trade with other players around the world from your smartphone.
Here’s the current list of Pokemon included in the Galar region Pokedex, the setting for Sword & Shield, as chronicled by Serebii. Note that this is not yet a comprehensive list and probably won’t be until the full release of the game.
This may come as a disappointment to many players who may not be able to transfer their favorite Pokemon from Pokemon Home to Sword & Shield. Fans were already disappointed by the fact that you cannot play with friends together online in Super Mario Maker 2 because Nintendo didn’t want to compromise the leaderboards, according to IGN.
Update: Nintendo just announced that the ability to play with friends in the online multiplayer mode in Super Mario Maker 2 will come in a future update.
Nintendo’s E3 presentation announced that you can play Sword & Shield with the Pokeball Plus. While you can’t use the device as a controller like in Pokemon: Let’s Go, Pikachu & Eevee, you can use it to take a Pokemon on a stroll for different rewards. They also revealed the water-type Gym Leader, Nessa.
The Nintendo Treehouse livestream demonstrated other features that weren’t previously confirmed in Sword & Shield. Players can whistle to get the attention of Pokemon in the Wild Area. Pokemon levels vary in the Wild Area with some Pokemon in certain areas being stronger than the player’s Pokemon. The bicycle can dash with a press of a B button and can transform to get across bodies of water. Items change every time you enter the Wild Area and some are found in shiny areas on the ground. Depending on the weather, you’ll encounter different Pokemon. According to the official Pokemon Twitter account, if there’s a thunderstorm, the battle with have the rainy weather and Electric Terrain conditions.
Other players can join you in the Wild Area through local and online connectivity, as seen in the livestream. Players can post icons to other players that show up on the left side of the screen indicating if they caught a Pokemon or if they want to trade. You can trade Pokemon and have Link Battles online and in person through a feature called Y-Comm, according to the Pokemon Twitter account.
After Max Raid Battles, where you fight a Dynamax Pokemon, all players will get a chance to catch the Pokemon they’re fighting for their team, according to the livestream. Even if players don’t catch the Pokemon, they’ll still get rewards. Dynamax Pokemon can create mysterious barriers that need to be broken before the team can start dealing damage again.
Read More: Pokemon Go Research Tasks: June 2019