Choose your forex trading style carefully

There are four main styles of forex trading, categorised by how long you keep your positions open:

  • The shortest is scalping, where you hold trades for minutes or even seconds at a time. The moment a position turns against you by even a couple of pips, you close it
  • In day trading, you aim to close all your positions by the end of the session. That means keeping them open for minutes or hours at a time
  • Next up is swing trading, where you hold positions for days or weeks, aiming to capture profits from the smaller trends within wider moves

Finally, position traders keep their trades open for weeks or months at a time, looking to take advantage of major trends

In general, shorter-term styles are more favoured by FX traders, but all are valid if you have the right conditions. You might want to try a few out and see what fits your plan best.

Similar Posts

  • Start with a demo account

    Bysaif Gill

    Speaking of trying things out, we’d always recommend that beginner traders start with a forex trading demo account before they commit real capital. That way, you can ensure that any early mistakes are made in a simulated environment that won’t end up costing you money. Most trading demos use real market pricing, so they’re as close as…

  • Learn how leverage works

    Bysaif Gill

    Leverage is fundamental to forex trading – without it, you’d have to commit huge amounts of capital to earn a return. However, it is important to understand the effect that leverage has on your profits and losses. When you trade using leverage, your provider is in effect lending you the additional funds needed to cover the…

  • Track your progress

    Bysaif Gill

    Making a plan is an excellent start, but to truly trade like an expert you’ll want to keep meticulous records about your progress – noting down the outcome from every position and keeping track of the factors that made it a success or a failure. Luckily, you don’t have to do this all manually. Your…

  • Start simple

    Bysaif Gill

    Another key consideration when you’re still in the early days of trading is not to take on too much too soon. Opportunities abound in the FX markets, but successful traders know which ones to seize and which ones to let go. It’s best to begin by only having one trade open at a time, giving…

  • Always use a stop-loss order

    Bysaif Gill

    Risk management might be the most important factor in dictating your long-term forex trading success – and the basic building block of any risk management strategy is the stop-loss order. Stop losses are instructions to your trading provider to close your open position if it moves a certain number of points against you. They are useful…