What are forex trading strategies?

These are the approaches that forex traders use to determine when to buy and when to sell. They form part of the sound risk management schemes that any forex mentor will train you. How you deploy these strategies means the difference between your thriving and surviving.

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Different types of forex trading strategies

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Position Trading

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Position trading is an approach where you hold trades for long periods—it could be a week, a month, or even several months. Timeframes are either daily or weekly. Position traders are well-versed fundamental analysis such as GDP, NFP, and retail sales. Also, technical analysis comes in handy pretty often.

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Swing Trading

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Swing traders hold trades for days to weeks—a medium-term strategy, with a 1-hour or 4-hour trading timeframe. A swing refers to “a single move.” Therefore, swing traders’ interests are to capture the market swing so they can make informed decisions. 

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Day Trading

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Day trading is quite like swing trading, only that you hold your trades for minutes or hours, with 5-minute and 15-minute timeframes. Therefore, you focus on capturing intraday volatility—to trade during that period. Unlike the previous strategies, you don’t need fundamental concepts.

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Scalping

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It is an extremely short-term trade strategy where traders hold their trade for seconds or a few minutes. However, no forex mentor will ever recommend that you trade with this strategy—you spend much of your profits on transactions. Worse still, in case the machines develop technical issues and become slow, you may end up losing unnecessarily.

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Any Concerns on Forex Trading Strategies? Ask a Forex Mentor

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Choosing the best forex trading strategies above may not be the easiest task in Forex trading. That’s why it is always a great idea to let someone show you the route. Luckily, you don’t have to struggle because an experienced forex mentor is here to help. Talk to me today and let us get going.