Forex Trading ? Scalping, Swing Or Position? | Finance information

Forex trading brings together a crowd of completely different people ? diverse professional background, unique personalities, unlike financial and marital status, location, gender, age, political and religious preferences, and finally different trading styles. What are those trading styles? Which one is most profitable? How to figure out Which style suits you best?

You can choose to be scalpers, swing traders or position traders. To say for sure which one is most profitable is impossible, because most professional traders mix it all up The trick is to figure out when is the right time to scalp, to swing and when it is the best position to run a.

Let?s look at each trading style in details:

1 Scalping

forex scalping tactic is the combination of high leverage and short term trade. The basic idea behind scalping is to make profits on tiny price movements, sometimes no more than 3 pips. A scalper has to focus on price action, join and get out of trades very quickly, about 5-10 pips gain each time and slowly double or triple the account.

forex scalping, used correctly, is one of The trading styles with minimum risk involved. If you want to adopt scalping to your trading strategy, here are some things you should consider:

? Which forex broker scalping support

Many forex brokers Thurs not allow scalp trading, since entering and exiting trades causes a broker to lose money. Take an extra time to find out Whether your broker supports online scalping.

? Strict Exit Strategy (both good and bad trades)

Stick to the plan and be disciplined. Staying in the trade ?just a little bit more? can bring catastrophic results.

High Leverage ?

scalper uses higher leverage than

normal, however keep in mind that forex market can easily move against you and cause significant losses account.

? Automated scalping strategy

Since scalping Involves short stays in the market (no longer than several minutes), a lot of scalpers automate their set of Ensure the rules to speed and consistency. Some forex trading platforms, MetaTrader 4, as tested, allow your system executing on every tick.

? Support and Resistance Levels

Find support / resistance levels that have worked on several occasions in the past (at new highs or lows chart).

? Look for Momentum

Is the price moving strongly towards either support or resistance level? Is there confirmation that the price momentum is about to turn? In order to get a confirmation that the price momentum will not take out support or resistance, use stochastic indicator. Stochastic lines will show you which way the market is trending. To read the hint right and take a trade, look for stochastic lines cross each other and Which point either up (showing support has won!) Or pointing down (showing resistance has won!).

second Position Trading

Position Trading Involves entering a position and holding it for quite a while (days, weeks, months or even years), or until the reason why you entered a trade in the first place (usually based on fundamental analysis) is unchanged

When trading position, focus on:.

? Average Trades

Weekly 3-bar pattern is a great strategy For forex trading position, used on daily and weekly frames.

? Decisions

Base your decision on fundamental trading data. The basic fundamental analysis includes political and economic changes. Position traders should get information about unemployment forecasts, economic policies, inflation, political principles, and growth rates.

? Position Size

A in position trading position size should be rather small, since you have to be able to endure daily price movements. To make this happen, the leverage used in trading position has to be rather small. Since it is possible for a currency pair to jump up and down as much as 3% in just a day, your account will be empty if your preference is more leverage than 1:30.

? Frequency Trading

In trading position, the number of trades are kept to minimum. In a way, a long term position can cause a forex trading forex market to lose profitable opportunities presents daily, however somewhat less trades decreases the number of losses.

? Time

Since position Trading is all about long-term profits, you might come to the conclusion that position trader has more free time. That is not exactly so, since the amount of time Considerable needs to be invested in order to analyze and make decisions based on fundamental data. You need to become an expert in economics and politics.

? Market Trend and Volatility

Once you gain experience in reading forex news and analysis, it will be easier to understand where the market is heading to. It is therefore crucial to understand the consequences of each trading decision. Forex market is volatile and at times creates uncertainty on. When you trade down long term positions, it is wise to avoid highly volatile periods and check out technical indicators to see when the volatility calms.

3 Swing Trading

Forex swing trading is all about making profits from major trend movements. It is rather to learn the right approach almost from wrong and stay disciplined

Swing Trading Involves the following:.

? Duration and Frequency

Despite the fact that Swing traders sometimes speculate on short-term currency price movements, overall they rather hold open positions for more than 24 hours. When swing trading, you have to place a trade only when a real opportunity strikes and hold it as long as Necessary (few hours or even few days).

? rollover fees

Swing traders often holds position overnight, Therefore the rollover fee is charged. It is, however, rather small Disadvantage Compared to spread and potential profit.

? Analysis

Swing traders capture large opportunities, and have to concentrate Therefore on long-term fundamental and technical analysis in order to spot a good entry.

? Support and Resistance

If swing trading is your style, you have to find (via both daily and weekly charts) valid support and resistance and focus on those points inside the trend. A good sign is when the points are on more than 3 different time frame charts. . Once you have the right support and resistance points, you can apply the trading signal

? Confirmation

Make sure to get a confirmation via forex indicators examined as momentum oscillators: stochastic and RSI (relative strength index). Keep in mind that trading without stochastic validation is not recommended.

? Stop and Target Points

Swing Trading Involves setting target points and stop points. Since forex swing trading is all about small gains almost, target point is important in order to gain the profit target is reached the moment the. Do not wait out ?a little bit longer.? ? You will most definitely loose

No matter what kind of trader you choose to be, each style is unique. While every style has its own forex trading nuances, it is Necessary to master them all successful forex trader A knows how and when to imply each style without getting carried away.

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