Best Forex Trading Strategies Every Newbie Needs To Know

FOREX- TRADING STRATEGIES Forex traders use a number of strategies to trade currency pairs successfully. Ideally, you will choose the forex trading strategy best suited to your personality, lifestyle and risk tolerance. The section below describe the most popular forex trading strategies in order from the shortest to the longest time frame a trade is typically held for. SCALPING DAY TRADING Scalping is a popular short-term trading Day trading involves establishing and closing out all trading style, used in the majority by technical analysis traders, discretionary traders, or system traders. positions within the normal trading session chosen by a trader. They Never Hold Take OVERNIGHT SMALL PROFITS to Buy or Sell by - POSITIONS RAPIDLY ENTERING & EXITING Their preferred technical analysis 30 charting time periods are typically five and thirty minute intervals. Scalpers never carry a position overnight and will typically close out a position within a minute of entering it. They also often use the tick or one Day trading can only profit from intraday moves, so they might tend to use higher levels of leverage than traders with a longer minute exchange rate charts for time horizon to magnify their profits from exchange rate shifts. their technical analysis. Scalpers thrive on volatility, such as that which can occur just after the release of major economic data. Scalpers' profile are especially SWING TRADING sensitive to the dealing spread, so they prefer to trade the most liquid Swing trading involves currency pairs. establishing and then closing out trading positions based on the momentum of the underlying currency pair, usually as determined by appropriate technical indicators. NEWS TRADING News trading involves trading around the time of a key news event, such as a major economic data release, and it generally does not involve taking overnight positions. KEY NEWS EVENT Their trading focus is typically on near term exchange rate movements, with all positions closed out within from one to four days, so they do hold overnight positions. Alternatively, they might establish a position just News traders thrive on after a news release has 1HR volatility, so they might establish forex positions just ahead of the news even and Their preferred chart time periods for technical analysis are typically one hour and daily intervals, and they often watch for chart patterns to give them trade ideas. Since swing traders 2 24 come out to take 22 advantage of the wide exchange rate swings that can occur if the result differs significantly from the market's consensus. 20 hold them through any 18 24HR movement that may result. can profit both from trends and 16 corrections, they can show a higher 14 10 rate of return from their trading 12 BEFORE AFTER activities compared with trend traders. KEY NEWS EVENT Trend trading is a longer term trading strategy that often involves using technical analysis to identify if and in what direction a trend exists, and then determining suitable entry points. TREND TRADING Trend traders generally take overnight positions- Take Positions Only sometimes running a position for months until the trend concludes - and they will often use trailing stops to protect the profits on a winning trade. IN THE DIRECTION OF hihli -PREVAILING- Exchange Rate Movements Trend traders also tend to prefer daily and weekly OR TRENDS chart time periods for their technical analysis, and they often use longer term chart patterns and fundamental analysis to yield trade ideas. Tred traders are relatively insensitive to the dealing spread, so they can trade in relatively illiquid currency pairs. PLATINUM www.platinumtradingacademy.com