All traders have their own personalities and beliefs. These traits reflect on how they trade in the forex market, whether they want to be aggressive when they see an opportunity, or patient with their set time frames. Because of that, each trader has to find his or her forex trading styles to trade better and confidently. The role of Online Trading Professional Brokers also cannot be denied here.
The first thing you have to do is determine your own trading personality, and finding the right style that fits it. In order to do this, reading the expert reviews like HQBroker Online Broker Review is highly recommended to find the most suitable style of trading according to you.
Failing to do this, you can lose your chances of making profitable trades. This is especially true for novice traders who fail to consider this crucial part.
Remove this sentence– “A trader who isn’t comfortable with his or her trading style is one of the biggest mistakes in trading. It’ll only result to bad trades and a waste of money”.
There are four main types of forex traders. What usually separates the trading styles is the length of time a trader intends to be in a trade, the timing of entry, and the frequency of the trades.
A day trader opens and closes a trade within the same day. This trading style usually avoids holding anything after the session closed, and will trade in a high-volume fashion. It involves picking trades at the beginning of the day, acting on bias, then ending the day with either a profit or a loss.
Swing traders take advantage of a swing of a chart, and try their chances of catching a big move. The popular timeframes of a swing trader is entering on the daily chart, and hold a trade for days, or sometimes weeks. This style is for traders who can’t watch the charts throughout the day. They dedicate a couple of hours analyzing the market every night to make decisions.
Instead of watching short-term market movements like the day and swing style, position trading tends to focus at a longer term plan. It spans days, weeks, months, or even years. This style realizes that fundamental themes will be the predominant factor when analyzing markets, making their trading decisions based on them.
Unlike any other styles, scalping requires you to watch the charts as if your life depends on it. A scalper will hold a trade for a few seconds to a few minutes at the most. The main goal is to grab small amounts of pips as many times as they can throughout the day. Even if it boasts higher potential of profits, it is still one of the hardest styles to master as it requires more discipline.
No matter what trading styles sound good to you, you have to ensure that it really fits your personality, time, and commitment. Changing your style repeatedly can leave disastrous results. If you want to learn more about forex trading styles, you can always ask your broker to help you give a better understanding and strategies.