When trading in financial markets, you will face many popular trading styles. Keep in mind that if a style brings good results for a trader, it does not mean that the same style results successfully for you also. In a few words, it is up to you and your circumstances which strategy to choose to trade with. Some factors are personality type, capital available, time available, knowledge and experience.
Trading strategies are fundamental tools for traders, designed for different styles and trading methods. Any trader needs to achieve profitable returns by applying any of them. A trading strategy will be effective if only it is applied with an accurate trading analysis, and it suits the trader’s mentality, goals, capital available, and trading knowledge.
Position Trading Strategy
Position trading uses daily to monthly trading charts to determine the future direction of the currency market. This type of trade is kept open for several days, weeks and often longer than that, depending on the instrument trend. Trend traders usually open positions after the trend has established itself. They close the position when the trend breaks.
Scalping Trading Strategy
Scalping is a strategy usually adapted by daily active traders. It is focused on various price gaps caused by sell-buy prices and order movements. The strategy works by buying at the bid price and selling at ask price, to get the difference between the two prices. Scalpers hold their positions for short periods of time, decreasing the risk level related to this strategy.
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