If you are new to forex trading or considering taking the plunge and start trading forex now, chances are you have realized that the best way to get started with forex trading is not to start blind. On the contrary, it would be better to approach it with a strategy that allows you to make the most of it.
Especially if you are not a full-time trader, understanding the market can be difficult. You’ll definitely learn a lot over time, but there’s no point in starting out with no idea what to do. To learn more about some of the most important strategies you can use in forex trading, continue reading below!
Look at long-term trends
Given the fast-paced nature of the market and the fact that it is open 24 hours a day, you might think that you have to stay in the market for long hours to make a trade, or that you have to invest a large part of your evening for to succeed in the positions you take, but that is not the case at all!
Because of the way the market works, if you find that you won’t be able to dedicate long time slots to trading during the day because of your job, it may be to look at daily or even weekly trends. went on. In this way, you don’t have to be at your computer all the time, and you can focus on watching the market once a day for e.g. one hour.
1. Consider Day Trading
With day trading, the trader does not hold a position beyond the day. There is thus no position open overnight, with the risk of major changes within a few hours. Trade items usually only for a few hours and the price bars on your charts may be limited to an hour or two at most. The day trader will focus on finding 2 or 3 good trading opportunities in a day.
2. Investigate the possibility of getting into Scalping
Scalping is a fairly fast-paced form of trading, and while it’s not for everyone, you may find that you work well under pressure and are able to make decisions quickly. If so, you might want to use this strategy.
These short trades sometimes last only a few seconds or minutes as scalpers try to take advantage of sudden small price movements in the market. Although you may spend more time in front of the screen, the actual trading time is minimal and you may decide to focus on a very limited number of currency pairs at a time, which will limit your research.
3. Choose positional trading
Positional traders, as the name suggests, tend to hold positions for longer periods of time, ranging from a few days to several weeks. Some positions can be held for months, and sometimes even years, as positional traders ignore minor market fluctuations and focus on the potential for long-term gain.
Although the pressure is not as strong as that of, for example, scalping, it still requires a lot of discipline because you have to decide at any time whether you want to close your position or not. It is considered one of the most advanced Forex trading strategies.
4. Get into Swing Trading
This strategy can be suitable for a beginner as it allows you to hold your position for a few days. You can use any chart from H1 to D1 and it can include breakout trading, trend following and streak trading.
This strategy is very beneficial if you are someone who can or prefers to analyze the markets in detail in your spare time and like to hold positions for a few days, sometimes even more than a week. You will be able to spot trends and other things much easier this way and it will allow you to develop general trading skills as you will not only learn how to keep your position open but also what market trends are.
Learn Forex Market Timer
If you trade on your own time, you can make a few trades before or after work if you know when the currency pairs you are interested in are most active. You can also see which currency pairs are most active at times that best suit your schedule. This can help you choose the best currency pairs to focus on while taking into account your professional limitations.
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