Forex Strategies

There are various different trading styles. You can choose to be a scalper, a day trader, a swing trader, or a position trader. Day trading You're a day trader if you don't hold open positions for more than one day. Some people call this style intraday trading. As a day trader you would be looking primarily at the hourly and smaller-timeframe charts. Most day traders follow the forex market action on the 15-minute and the 5-minute charts. However, in all your intraday trades always bear in mind what the overall trend is (uptrend or downtrend) as indicated on the weekly and daily charts. Scalping Scalping is technically a type of very aggressive day trading. You would be considered a scalper if you hold open positions for not more than a few minutes, sometimes even a few seconds. Since the bulk of a scalper's profits are not greater than 10 pips, he would normally commit a bigger part of his account equity in a given trade, so that his pip value is significant. Please keep in mind that not every broker allows you to scalp. Some brokers could allow you to scalp for a while, but at a certain point you may start getting re-quotes continuously and your desire to become the scalping hero of the forex market may very well wane. Shop around. There are decent brokers out there, too. Swing trading A swing trader strives to ride short-term trends called swings. He would keep positions for between a few hours and several days or weeks. Swing traders are calmer folks when compared to day traders or scalpers. An appropriate way for a beginner to get his forex career going and acquire experience is precisely by swing trading. Position trading For goodness' sake! Should we write about this? A position trader holds positions for many months on end. It's extremely boring! Now, don't get us wrong. If you want to be a successful, consistently profitable forex trader, trading should be boring. You should not get into forex in search of thrills and emotional highs and lows. There are casinos for this purpose. Anyway, position trading is just way too boring to bother with.