What type of Forex trader would you like to be

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What Type of Trader Are You?

Table of Contents

How to decide what type of trader are you

What is your trading style?

A lot of people consider investments to be the best form of making money, so it comes as no surprise to learn that a lot of people learn about financial markets and trading through this avenue. Investing is about slowly building wealth over time and is done by implementing a buy-and-hold approach. You make investments like in mutual funds or ETF, stock and let the price increase over time.

Investors will weather the storm, which is the inevitable downtrends in the market because the expectation is that the market will rebound, and prices will increase in the long-term. After several years, the investment will start increasing in value, which is when the investor will start getting positive returns. The returns of long-term investments can be improved by compounding with reinvestment of dividends and profits. Investments are one of the best ways to build wealth and generate stable income in the retirement years.

What fully funded traders use

Fully funded traders use various strategies to identify and capitalize on any opportunity in the market. A lot of traders choose to enter and exit multiple trades in a day, while others prefer to hold their positive for several weeks or months. It all depends on the trading style you choose, but a lot of inexperienced traders find it difficult to choose a trading style that suits their personality. However, it is essential for the long-term success of a trader to find their trading style.

A lot of traders will improve their trading style over the course of their career and is also known as trader growth. When you are a new trader, you will think that you have found your trading style multiple times, but it is important to experiment with all the different trading styles, so you can find one that is compatible with your personality traits. It is imperative that all traders find a trading style that matches their personality to become a profitable trader.
We have helped numerous fully funded traders find their trading style and are going to discuss some of the best ways to find one that works for you. The best way to find out what type of trader you are and most importantly, what your trading style is to look at the following:

  • The length of time you intend to be in a trade
  • The time of your entry
  • The frequency of the trades

You can choose your own timeframe as a trader to indulge in trading, but you should know that it will impact on your trading style. So, first let’s check out the different trading styles, so you can find out what type of trader you are:

Trend trading

Trend trading is about identifying a trend and then trading in the same manner as the trend is heading towards. Long-term fund managers were traditionally identified as trend traders, but, you can become a trend trader by trading at any timeframe you want.

Technical trading

Technical trading is difficult since you will need to analyze, enter, manage, and exit your trading based on technical analysis. This form of trading can be done in any timeframe, but technical traders tend to favor intraday timeframes. Long-term forecasting also uses technical analysis.

Swing trading

Swing traders look to trade on the swing of a chart hoping to catch a major move in the market. The most popular timeframe for swing trading is to enter on the daily chart and then hold the position for multiple days, and weeks. The 1-hour charts are popular, as you can hold a position for several hours, overnight, or even for a few days.


There are different forms of intraday trading, and scalping is one of the common ones, where you are essentially glued to the screen. It is a popular style because it offers greater potential for profits, but it is one of the most difficult trading styles to master. Scalping requires a lot of patience from the trader, but a lot of newbie traders still prefer choosing this style.

Position trading

Position traders will hold their position for long-term rewards. They can hold their position for weeks, months, and even years, because they are trading for long-term benefits. The traders will not move from their position, even if there are short-term fluctuations, because they have a long-term forecast in mind, which will smooth out any fluctuations.
Swing and position traders tend to use pending orders to enter the market, and they don’t need to be staring at their screens when they enter or exit their trades.

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News trading

New traders are specialists in ‘Red News’ events and will only trade when there is an important news release. If there is a surprise figure released, there can be extreme volatility in the markets, but that rarely happens. However, there is a lot of opportunities to make profits over a short time, due to the volatility. There can also be long-term consequences due to an important news that may interest in macro traders, who are trading on long-term trends.

Intraday trading

Intraday traders tend to open and close trades on the same day and place greater emphasis on the technicalities of trading, instead of the fundamentals. There are various forms of intraday trading, which every fully funded trader must master to achieve trader growth.

Fundamental (Macro trading)

Macro traders use fundamental information or financial models to gauge the strengths and weaknesses of a stock, market, country, or currency to anticipate the price value in the future. Information sources tend to vary between Forex and stocks since they are affected by internal news of organizations.

EOD (End of Day)

This is one of the most popular trading styles around and involves traders analyzing the markets on a daily and weekly basis. They must set pending orders to catch evolving price moves, and don’t need to watch their screens when triggering orders. If you have a busy life, then you can choose this method, since it doesn’t require time in front of the screen to manage or analyze trades.

Which Trading Style Are You?

There are a lot of different factors you must account for as a trader, which will determine which trading style best suits you. These factors include the following:

  • Risk tolerance
  • Personality
  • Level of trading experience
  • Amount of time that can be dedicated to trading
  • Account size

As a trader, you find there is a complex relationship between the amount of time you must devote to the market and the trading time frame. For instance, position traders must spend a couple of hours every week to manage and evaluate trades. In scalp trading, traders have a full-time job and must spend every minute behind a screen to manage traders actively.

A lot of fully funded traders or other traders or investors don’t fit into one trading category or style. For instance, a lot of long-term investors are also traders, but there are also those that only day trade with a couple of swing trades sometimes. It will take you experience and time to figure out the trading style that best works for you, and as you achieve trader growth, you will find the answer.

11 Виды стратегии форекс каждый трейдер должен знать о

Различные типы торговых стратегий Форекс

Вот 11 виды лучших стратегий форекс торговли, что каждый трейдер должен знать.

Скальпинг Торговые стратегии Форекс

Начнем с стратегии Forex скальпинг первый. Она включает в себя создание большого количества сделок и каждая сделка делает небольшую прибыль по отдельности. Когда трейдер делает использование стратегий Forex скальпинг, то он ожидает, что прибыль в размере около 5 к 10 пипсов в торговле. Если вы решили использовать стратегию скальпинга, то это может быть сложной задачи, поскольку она требует от вас сделать постоянный анализ рынка Forex, и вам необходимо разместить несколько сделок. Это делает используя стратегии скальпинга полный рабочий день,. во-вторых, если вы решили скальп валют, то вы должны быть осведомлены о том, что вы можете только скальп в течение нескольких часов в дневное время. Когда вы хотите, чтобы ваша стратегия скальпинга, чтобы иметь успех, то вам нужно быть быстрым в прогнозировании, где рынок будет идти. следующий, вы должны открывать и закрывать позиции всего за считанные секунды.

Форекс Тренд После торговых стратегий

Это Forex торговая стратегия пытается использовать механизм тенденции рынка и направлен в сторону, воспользовавшись долгосрочных целей. Трейдеры, которые выбирают Forex Trend следующие стратегии используют прорывы канала, скользящего среднего и текущего расчета рыночных цен для определения направления рынка и генерирования сигналов. Трейдеры, которые выбирают тренд следующих стратегий не стремятся сделать прогноз или предсказать ценовые уровни. Они просто следуют тенденции. Сейчас тенденция следующие стратегии развертывания компонента управления рисками, что делает использование текущей волатильности рынка, текущая рыночная цена и количество акций, принадлежащих. Трейдер должен быть ориентирован на рыночные тенденции, а текущая цена может помочь трейдеру констатировать этот факт.

Forex Волатильность Торговые стратегии

Если вам интересно, что изменчивые рынки тогда простая характеристика летучего рынка резкие скачки в цене. В настоящее время системы волатильности прорыве разработаны таким образом, что они могут воспользоваться преимуществами этого типа ценового действия. Ниже приведены основные характеристики систем волатильности прорыве.

  • Они не извлекать выгоду из больших движений.
  • Волатильность системы прорыва сделки с краткосрочными и быстрых сделок.
  • Процент выигрыша торгов выше, но прибыль, полученная за торговлю сравнительно низок.
  • Системы Волатильность прорыва основаны на увеличении волатильности.

Вот почему вы должны выбрать только для Волатильность стратегии форекс, если вы понимаете, восприятие систем прорыве волатильности.

Forex Полосы Боллинджера Торговые стратегии

Полосы Боллинджера являются отличным техническим инструментом анализа. Полосы Боллинджера используются для измерения низости и высочество ценового относительно предыдущих торгов. Полосы Боллинджера бывают трех типов, которые включают в нижнюю полосу, выше полоса, и средней полосы. Цены имеют тенденцию быть высокими в верхней полосе и низкой в ​​нижней полосе. Это помогает в распознавании образов. То, как трейдеры используют стратегии Форекс полосы Боллинджера Некоторые трейдеры выбирают вариант покупки, когда цена может коснуться нижней полосы Боллинджера и, как правило, чтобы выйти, когда цена может коснуться скользящей средней в центре полосы.

Некоторые трейдеры, как правило, выбирают для покупки, когда цена может прорваться выше верхней полосы Боллинджера и продавать, когда цена падает ниже нижней полосы Боллинджера.

Breakout Торговые стратегии Форекс

Если вы собираетесь использовать Forex Breakout Стратегии тогда, прежде всего, Вы должны понять концепцию Breakout. Теперь прорыв является точка, в которой рынок имеет тенденцию отрываться, или рынок начинает отходить от торгового диапазона. Торговый диапазон может быть для любой длины времени. Однако, если цена не превысит нижнюю или, более высокий диапазон, то это означает, что произошел прорыв. Если вы хотите, чтобы делать деньги, используя стратегии прорыва, то вам нужно заниматься в покупке и продаже выше выше в бычьем рынке. Если вы имеете дело с рынком медведя, то вы должны продавать низко и купить обратно ниже.

Forex Образцы Диаграммы Торговые стратегии

Что ж, Есть некоторые графические паттерны, когда вы предались на рынке Форекс. Однако, существуют две диаграммы схемы, которые обычно используются. Эти графические модели являются треугольник и Голова и Плечи. Треугольники, как правило, происходят довольно часто в краткосрочных временных рамках. Они могут быть нисходящий, восходящие и симметричная. Треугольник происходит, когда цена сходится с низкой и высокой сужением его в более жесткой ценовой зоне.

Голова и Плечи больше из долива формации, когда происходит тенденция к повышению. Это формирование нисходящего тренда, когда пассивом образование имеет тенденцию происходить. Картина, как правило, завершить в головы и плеч, когда разрывы линии тренда. Для того, чтобы преуспеть с помощью Forex Chart Patterns стратегии, которые вы должны понять концепцию формирования рисунка хорошо.

Торговые стратегии Forex Pivot Point

Повороты являются весьма полезными на рынке Форекс, поскольку они помогают определить точки входа для трейдеров диапазонных. Опорные точки также помогают прорыве трейдеров и трейдеров тренда для выявления ключевых моментов, которые должны быть сломаны для конкретного шага, чтобы его можно квалифицировать как прорыве. Однако, для применения стратегий точки разворота Форекс наилучшим образом в первую очередь необходимо понять концепцию Pivot и как она рассчитывается. Теперь точка поворота фактически является точкой вращения. Цены, которые используются для расчета точки поворота являются цены закрытия, низкие периоды ценной бумаги и высокий период вы можете получить информацию о ценах от дневных графиках ее акций. Однако, Точки поворота также может быть вычислен путем использования часовых графиках. Вы должны помнить важный аспект. Если рассчитать точку поворота, используя цены закрытия в короткие сроки, то это уменьшит значимость и точность точки поворота, а также. Расчеты точки поворота должны быть точным, поскольку она является основным поддержка на рынке Форекс.

Forex поддержки и сопротивления Торговые стратегии

Прежде всего, давайте рассмотрим, что означает, что поддержка на рынке Форекс. Это на самом деле зона, где покупатели, как правило, больше, чем продавцов, а вот цена имеет тенденцию к увеличению стоимости. Сопротивление противоположность поддержки. Это означает, что продавцы больше покупателей и, таким образом, это приводит к снижению цен. Теперь лучше всего сделать, будет покупать на сопротивлении и продавать при поддержке. Сопротивление и поддержка являются жизненно важными аспектами рынке Форекс. В настоящее время оба эти параметры, как правило, держать на изменение в зависимости от динамики рынка. Инвестор должен убедиться, что он исследует поддержку Форекс и стратегии сопротивления в деталях, прежде чем применять их.

Forex Подсвечники Торговые стратегии

Что ж, подсвечников считаются самым мощным техническим инструментом анализа. Подсвечники часто используются в качестве режима по умолчанию для построения графиков. Если Подсвечники применяются правильно, то они могут дать вам правильное представление о ситуации на рынке. Существует никаких сомнений по поводу того, что Подсвечники можно назвать как ведущих показателей деятельности на рынке. Приблизительно насчитывается около 100 Образцы подсвечника и Подсвечники на рынке. таким образом, это не простая задача для трейдера, чтобы понять все модели подсвечников и Подсвечники на одном дыхании. То, что вам нужно сделать, это то, что вы должны тратить время и усилия, исследуя стратегии Forex Подсвечники. Таким образом, вы сможете понять каждое понятие. Понимание подсвечников повлияет на ваш успех на рынке Форекс. Теперь еще один наиболее важный аспект являются модели Подсвечники, и они могут помочь вам в принятии выгодных торговых решений и даже улучшить точность ваших предсказаний. Есть некоторые важные термины, которые трейдер должен знать при использовании подсвечников.

Разница, которая существует между открытием и закрытием, называется, как реальное тело. Более высокие значения делают верхний крайности реального тела. Более низкие значения делают, нижний экстремум реального тела.

Белые или зеленые свечи, как правило, представляют собой растущую цену. Черные или красные свечи, как правило, представляют собой ценовые падения дней. Подсвечники могут быть созданы для еженедельно, ежемесячно или почасовой период. При этом помните понятия, если вы собираетесь использовать стратегию Подсвечники.

Форекс Ренко Диаграмма Торговые стратегии

Теперь, если вы собираетесь преуспеть на рынке Форекс, то вы можете использовать на графике Стратегии Форекс Ренко а. Способ построения Ренко диаграммы является то, что, когда цена превосходит нижнюю или верхнюю часть предыдущего кирпича по заранее определенной суммы, то кирпич должен быть помещен в следующей колонке. Когда тренд вверх используются белые кирпичи. Когда тренд вниз, то используются черные кирпичи. Этот тип диаграмм будет очень полезно для вас, если вы в торговле иностранной валютой, потому что вы будете в состоянии определить ключевое сопротивление и уровни поддержки. Когда тренд меняется, то кирпичи, как правило, принимают альтернативные цвета, а сигналы транзакции генерируются в тот момент времени,.

Объем и время не играют никакой роли в Ренко Chart. В Ренко Свечи, как правило, похожи на маленькие кирпичи. У них нет нижний и верхний тени. Можно изменить размер окна в Ренко диаграмм. Когда коробка размер меньше, это означает, что количество коробок будет выше,. Вполне возможно, что цена может превысить нижнюю часть текущего кирпича или верхней части текущего кирпича. Новый кирпич добавляется только когда цены могут пополнить текущий кирпич полностью.

Forex Свинг Торговые стратегии

Ну это торговая стратегия обеспечивает простой метод для торговли валютами. Вам не нужно держать долгосрочные тенденции для этой торговой стратегии, И еще, вы можете сделать много прибыли. Теперь лучшая часть о свинг-трейдинга является то, что вы будете иметь набор цель и как только вы достигнете этого целевого показателя тогда момент, когда вы вне. Теперь, когда вы делаете использование Свинг торговых стратегий Форекс, то вы должны помнить тот факт, что оба прибыли и убытки будут иметь тенденцию к весьма быстро. Это означает, что вы не должны быть долгосрочный тренд последователем и это делает поворотных торговых стратегий отличный вариант для начинающих трейдеров, которые только начали торговать


В настоящее время все упомянутые стратегии идеально подходят, если вы намерены начать Форекс. Теперь вы должны понимать тот факт, что это займет некоторое время, чтобы развить команду над торговыми стратегиями. Вы будете иметь свою долю прибылей и убытков, первоначально. Однако, вы не должны получить расстроен этим и в конце концов вы добьетесь успеха в качестве трейдера Форекс.

Когда у вас есть четкое представление об этих торговых стратегий Форекс, то вы не возникнут проблемы при применении этих торговых стратегий в правильном пути.

Шаг в торговле иностранной валютой сегодня и попробовать лучшие стратегии форекс!

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Which Type of Trader Are You?

Scalper, Day Trader, Swing Trader, or Position Trader. What are you?

Know The Different Types Of Trading Styles

Each forex trader is unique

There are over 8 billion people in the world (including space aliens disguised as humans and automobiles) and not one person is exactly the same as another.

Even identical twins will have different fingerprints. Everyone has their own look, personality, talents, and pizza topping preferences (we like pepperoni and potato chips).

We all like different things and are unique in our own way.

Trading is the same way. Our unique personalities will lead us to trade differently from one another. Some may be aggressive, “type A” personality traders while others may be more relax, “type B” personality traders.

Some may like taking small wins all the time, while others don’t mind losing a bit in order to make those huge gains when they do win.

The point is that no two traders are alike. Even if a group of people was to trade the same system rules, each person’s end results would most likely be different from everyone else. Is that a bad thing?

Our uniqueness is what makes the world go round, so it’s important to know your lifestyle and personality to help identify trading strengths and weaknesses.

Trying to force a trade that doesn’t match your personality will result in frustration and can hinder you from making consistent profits.

This lesson will take you through a variety of trading styles so that you can identify which one may match you the best.

Your Most Important Investment As A Forex Trader

A common mistake by many new traders is that they think they can make money… fast!

While it’s true you can make money in a short amount of time, it doesn’t mean you will end up profitable in the long run.

A typical scenario is that a new trader reads a little bit about trading forex, finds a system online that claims to make money quickly, and then jumps right into trading because he feels like he’s got enough of a background to make millions of dollars. Unfortunately, after the “honeymoon” period is over and the excitement settles down, this new trader now realizes that trading isn’t as easy as he thought.

The system doesn’t seem to be working like it claimed it would and he has no idea why the market is doing what it’s doing.

The most important thing you can invest in as a forex trader is your TIME!

Every single trading day is a learning experience and if you stop learning, then you will never become a truly successful trader. Take into account how much time it will take you to learn the basics. Then consider how much time it will take in your daily routine to read charts, news reports, record your trades, and be in the markets.

For someone who can dedicate a “full-time” job mentality to forex trading, then this is no problem.

However, if you’re like most people, you may have a job, school work, tuba lessons, Crossfit sessions, so you cannot exactly dedicate your entire day to trading.

This doesn’t mean that you can’t trade, but it should give you some realistic expectations when it comes to determining your trading style.

You probably can’t be a scalper or day trader, but maybe longer term trades will work better for your schedule.

Each day requires your time to analyze the market. Because news makes the market move, it’s important to consider the economic developments going on around the world and to make it part of your daily routine.

Four things to consider in your market analysis:

1. Forex Market Developments

Look at what the “talk of the town” is in the forex world. See what the analysts are buzzing about and how the currencies reacted.

2. News Releases

Know what news reports are coming out each day and how they affect the markets.

The more important the news report, the more movement you can expect to see in its currency. Make sure you check out Forex Calendar

3. Market Prices of Other Asset Classes

The price of oil or U.S. Treasury yields can affect the way currencies move so it’s important to find out why these things are rising or falling and keep that in mind when trading currencies.

4. Current Events

Check out many news websites and get to know what is happening across the globe.

Events such as major elections, military conflicts, and political scandals can all affect currency movements or global risk sentiment.

5. Review the Charts

Finally, after going through your daily economic analysis, you have to look at the charts.

Charts will give you insights into key support and resistance levels, trends, and possible price points in which to enter the market.


Scalping is like those high action thriller movies that keep you on the edge of your seat. It’s fast paced, exciting, and mind-rattling all at once.

These types of trades are usually only held onto for a few seconds to a few minutes at the most!

The main objective for forex scalpers is to grab very small amounts of pips as many times as they can throughout the busiest times of the day.

Because scalpers basically have to be glued to the charts, it is best suited for those who can spend several hours of undivided attention to their trading.

It requires intense focus and quick thinking to be successful.

It is not for those looking to make big wins all the time, but rather for those who like raking in small profits over the long run to make an overall profit.

You might be a forex scalper if:

  • You like fast trading and excitement
  • You don’t mind being focused on your charts for several hours at a time
  • You are an impatient person who doesn’t like to wait for long trades
  • You can think fast and change bias, or direction, quickly
  • You have fast fingers (put those eSport skills to work!)
  • You are a surgeon!

You might NOT be a forex scalper if:

  • You easily get stressed in fast moving environments
  • You can’t commit several hours of undivided attention to your charts
  • You’d rather make fewer trades with higher profit gains
  • You like taking your time to analyze the overall picture of the market

Some things to consider if you decide to scalp:

Trade only the most liquid pairs

Pairs such as the EUR/USD, GBP/USD, USD/CHF, and USD/JPY offer the tightest spreads because they tend to have the highest trading volume.

You want your spreads to be as tight as possible since you will be entering the market frequently.

Trade only during the busiest times of the day

The most liquid times of the day are during the session overlaps. This is from 2:00 am to 4:00 am and from 8:00 am to 12:00 noon Eastern Time (EST).

Make sure to account for the spread

Because you enter the market frequently, spreads will be a big factor in your overall profit.

Be sure your targets are at least double your spread so that you can account for the times the market moves against you.

Try focusing on one pair first

Scalping is very intense and if you can put all your energy in one pair, you’ll have a better chance at being successful.

Trying to scalp multiple pairs simultaneously as a noob will almost suicidal.

If you start to get accustomed to the pace of things, then you can start by adding on another pair and see how it works for you.

Make sure you follow good money management

This goes for any type of trading, but since you are making so many trades within a day it is especially important that you are sticking to risk management practices.

Major news reports can throw you off

Because of slippage and high volatility, trading around highly anticipated news reports can be very dangerous.

It sucks when you unexpectedly see price jump in the opposite direction of your trade because of a news report!

Be prepared and know what’s coming out by checking out the economic calendar.

Day Trading

Day trading is another short term trading style, but unlike scalping, you are typically only taking one trade a day and closing it out when the day is over.

These traders like picking a side at the beginning of the day, acting on their bias, and then finishing the day with either a profit or a loss.

They DON’T like holding their trades overnight. Day trading is suited for forex traders that have enough time throughout the day to analyze, execute and monitor a trade.

If you think scalping is too fast but swing trading is a bit slow for your taste, then day trading might be for you.

You might be a forex day trader if:

  • You like beginning and ending a trade within one day.
  • You have time to analyze the markets at the beginning of the day and can monitor it throughout the day.
  • You like to know whether or not you win or lose at the end of the day.

You might NOT be a forex day trader if:

  • You like longer or shorter term trading.
  • You don’t have time to analyze the markets and monitor it throughout the day.
  • You have a day job.

Some things to consider if you decide to day trade:

Stay informed on the latest fundamentals events to help you choose a direction

You will want to keep yourself up-to-date on the latest economic news so that you can make your trading decisions at the beginning of the day.

Do you have time to monitor your trade?

If you have a full-time job, consider how you will manage your time between your work and trading. Basically….don’t get fired from your job because you are always looking at your charts!

Types of Day Trading

Trend trading

Trend trading is when you look at a longer time frame chart and determine an overall trend. Once the overall trend is established, you move to a smaller time frame chart and look for trading opportunities in the direction of that trend.

Using indicators on the shorter time frame chart will give you an idea of when to time your entries.

First, determine what the overall trend is by looking at a longer time frame.

You can use indicators to help you confirm the trend.

Once you determine the overall trend, you can then move to a smaller timeframe and look for entries in the same direction.

Remember this? It’s called Multiple Time Frame Analysis!

Countertrend trading

Countertrend day trading is similar to trend trading except that once you determine your overall trend, you look for trades in the opposite direction.

The idea here is to find the end of a trend and get in early when the trend reverses. This is a little riskier but can have huge payoffs.

In this example, we see that there was a long and exhausted downtrend on the 4hr chart. This gives us. an indication that the market may be ready for a reversal.

Since our thinking is “counter-trend”, we would look for trades in the opposite direction of the overall trend on a smaller timeframe such as a 15-minute chart.

Remember that going opposite of the trend is very risky, but if timed correctly, can have huge rewards!

Breakout trading

Breakout day trading is when you look at the range a pair has made during certain hours of the day and then placing trades on either side, hoping to catch a breakout in either direction.

This is particularly effective when a pair has been a tight range because it is usually an indication that the pair is about to make a big move.

Your goal here is to set yourself up so that when the move takes place you are ready to catch the wave!

In breakout trading, you determine a range where support and resistance have been holding strongly.

Once you do, you can set entry points above and below your breakout levels.

As a rule of thumb you want to target the same amount of pips that makes up your determined range.

Swing Trading

Swing trading is a longer term trading style that requires patience to hold your trades for several days at a time.

It is ideal for those who can’t monitor their charts throughout the day but can dedicate a couple of hours analyzing the market every night.

This is probably best suited for those who have full-time jobs or school but have enough free time to stay up-to-date with what is going on in the global economies.Swing trading attempts to identify “swings” within a medium-term trend and enter only when there seems to be a high probability of winning.

For example, in an uptrend, you aim to buy (go long) at “swing lows.” And conversely, sell (go short) at “swing highs” to take advantage of temporary countertrends.

Because trades last much longer than one day, larger stop losses are required to weather volatility, and a forex trader must adapt that to their money management plan. You will most likely see trades go against you during the holding time since there can be many fluctuations of the price during the shorter time frames.

It is important that you are able to remain calm during these times and trust in your analysis.

Since trades usually have larger targets, spreads won’t have as much of an impact on your overall profits.

As a result, trading pairs with larger spreads and lower liquidity is acceptable.

You might want to be a swing trader if:

  • You don’t mind holding your trades for several days.
  • You are willing to take fewer trades but more careful to make sure your trades are very good setups.
  • You don’t mind having large stop losses.
  • You are patient.
  • You are able to remain calm when trades move against you.

You might NOT want to be a swing trader if:

  • You like fast paced, action-packed trading.
  • You are impatient and like to know whether you are right or wrong immediately.
  • You get sweaty and anxious when trades go against you.
  • You can’t spend a couple of hours every day to analyze the markets.
  • You can’t give up your World of Warcraft raiding sessions.

If you have a full-time job but enjoy trading on the side, then swing trading might be more your style!

Position Trading

Position trading is the longest term trading and can have trades that last for several months to several years!

This kind of forex trading is reserved for the ultra-patient traders, and requires a good understanding of the fundamentals.

Because position trading is held for so long, fundamental themes will be the predominant focus when analyzing the markets.

Fundamentals dictate the long term trends of currency pairs and it is important that you understand how economic data affects your countries and its future outlook.

Because of the lengthy holding time of your trades, your stop losses will be very large. You must make sure you are well capitalized or you will most likely get margin called.

Forex position trading also requires thick skin because it is almost guaranteed that your trades will go against you at one point or another.

These won’t just be little retracements either. You may experience huge swings and you must be ready and have absolute trust in your analysis in order to remain calm during these times.

You might be a forex position trader if:

  • You are an independent thinker. You have to be able to ignore popular opinion and make your own educated guesses as to where the market is going.
  • You have a great understanding of fundamentals and have good foresight into how they affect your currency pair in the long run.
  • You have thick skin and can weather any retracements you face.
  • You have enough capital to withstand several hundred pips if the market goes against you
  • You don’t mind waiting for your grand reward. Long term forex trading can net you several hundred to several thousands of pips. If you get excited being up 50 pips and already want to exit your trade, consider moving to a shorter term trading style.
  • You are extremely patient and calm.

You might NOT be a forex position trader if:

  • You easily get swayed by popular opinions on the markets.
  • You don’t have a good understanding of how fundamentals affect the markets in the long run.
  • You aren’t patient. Even if you are somewhat patient, this still might not be the trading style for you. You have to be the ultimate zen master when it comes to being this kind of patient!
  • You don’t have enough starting capital.
  • You don’t like it when the market goes against you.
  • You like seeing your results fast. You may not mind waiting a few days, but several months or even years is just too long for you to wait.

What Type Of Forex Trader Are You?

There are four main types of forex traders:

  1. The Scalper
  2. The Day Trader
  3. The Swing Trader
  4. The Position Trader

Scalpers hold onto for a few seconds to a few minutes at the most. Their main objective is to grab very small amounts of pips as many times as they can throughout the busiest times of the day.Day traders usually pick side at the beginning of the day, acting on their bias, and then finishing the day with either a profit or a loss. These kinds of traders do not hold their trades overnight.

Swing traders are for those people that like to hold on to trades for several days at a time. These types of traders can’t monitor their charts throughout the day so they dedicate a couple hours analyzing the market every night to make sound trading decisions.Position traders are those that have trades that last for several weeks, months, or even years. These traders know that fundamental themes will be the predominant factor when analyzing the markets and therefore make their trading decisions based on them.

No matter what style you choose, you have to make sure that it is truly fits your personality. Always changing your forex trading style can lead to trouble and is a sure fire way to the doghouse.

But if you try scalping and you realize after a week that it’s too fast or too draining, then be flexible enough to switch it up.

Technical indicators every trader should know

Success comes from knowledge – this is true for most things in life and especially Forex trading. To become successful, a trader needs to learn technical analysis. Technical indicators are a big part of technical analysis.

The problem is that, at first sight, names of technical indicators can sound unpleasantly complicated, for example, MACD, RSI or Stochastic. However, we recommend you not to judge a book by its cover. We will provide you with a fair and simple explanation of the most popular technical indicators. We guarantee that you will understand how to use them. Are you interested? Let’s start then!

Do technical indicators actually work?

We trade to get a positive result or, in other words, profit. Many beginner traders are eager to know whether technical indicators are able to give them good trading signals.

The truth is that technical indicators won’t automatically lead you to profit, but they will do a lot of work for you. There are no doubts that a skillful and experienced trader can achieve profit without indicators, but they can still help a lot.

In fact, technical indicators can do a few wonderful things:

  • show something that is not obvious;
  • help to find a trade idea;
  • save time for market analysis.

Every technical indicator is based on a mathematical formula. These formulas make fast calculations of various price parameters and then visualize the result on the chart. You don’t need to calculate anything yourself: just go to MetaTrader menu, click on “Insert” and then choose an indicator you would like to add to the chart.

At the same time, technical indicators make their calculations only on the basis of a price – the currency quotes, which are reordered in the trading software. As a result, indicators do have weak spots: they can give signals which lag behind the price (for example, the price has already fallen when the indicator finally gives a signal to sell).

The good news is that there are ways to get a lot of benefits from technical indicators. We are going to explain how to do it in the paragraph that follows.

The best technical indicators for Forex traders

Technical indicators are divided into several groups depending on their purpose. As purposes of the indicators are different, a trader needs not one, but a combination of several indicators to open a trade. In this article, we will tell about the 3 most popular technical indicators.

1. Moving Average – an indicator to identify the trend

Moving Average (MA) is a trend indicator. It helps to identify and follow the trend.

Technical principle: MA shows an average value of a price over a chosen time period.

In simple terms: Moving Average follows the price. This line helps to smooth the price volatility and get rid of the unwanted price “noise”, so that you focus on the main trend and not on corrections. It is necessary to understand that this indicator does not predict the future price, but outlines the current direction of the market.

Advantages of Moving Average:

  • identifies a direction of a trend;
  • finds trend reversals;
  • shows potential support and resistance levels.

Disadvantages of Moving Average:

  • lags behind the current price (will change more slowly than the price chart because the indicator is based on the past prices).


  • There are 4 types of the Moving Averages – simple, exponential, linear weighted and smoothed. The difference between them is merely technical (how much weight is assigned to the latest data). We recommend you to use Simple Moving Average as most traders use this line.
  • The most popular time periods for MA are 200, 100, 50 and 20. 200-period MA may help to analyze a long-term “historical” trend, while the 20-period MA – to follow a short-term trend.

How to interpret

In short, a trend is bullish when the price of a currency pair is above the MA and bearish – when the price falls below. In addition, note how Moving Averages with different periods behave towards each other.

Upward bias is confirmed when a shorter-term MA (e.g. 50-period) rises above the longer-term MA (e.g. 100-period). And vice versa, a downward bias is confirmed when a shorter-term MA goes below the longer-term MA.


Moving Average shows whether to buy or sell a currency pair (buy in an uptrend, sell in a downtrend). MA won’t tell you at what level to open your trade (for that you’ll need other indicators). As a result, applying a trend indicator should be among the first steps of your technical analysis.

2. Bollinger Bands – an indicator to measure volatility

Bollinger Bands helps to measure market volatility (i.e. the degree of variation of a trading price).

Technical principle: Bollinger Bands consist of 3 lines. Each line (band) is an MA. The middle band is usually a 20-period SMA. It identifies trend direction – just like the MAs described above do. Upper and lower bands (or “volatility” bands) are shifted by two standard deviations above and below the middle band.

In simple terms: Bollinger Bands indicator puts the price in a kind of box between the two outside lines. The price is constantly revolving around the middle line. It can go and test levels beyond the outside lines, but only for a short period of time and it won’t be able to get far away. After such deviation from the center, the price will have to return back to the middle. You can also notice that during some periods of time Bollinger lines come closer together, while during other periods of time they spread and the range becomes wider. The narrower the range, the lower is market volatility and, vice versa, the bands widen when the market becomes more volatile.

Advantages of Bollinger Bands:

  • The indicator is actually great in a sideways market (when a currency pair is trading in a range). In this case, the lines of the indicator can be used as support and resistance levels, where traders can open their positions.

Disadvantages of Bollinger Bands:

  • During a strong trend, the price can spend a long time at one Bollinger line and not go to the opposite one. As a result, we don’t recommend Bollinger Bands for trending markets.

How to interpret

The closer the price approaches the upper band, the more overbought the currency pair becomes. To put it simply, by this time buyers have already made money on the advance of the price and close their trade to take profit. The result is that the overbought pair stops rising and turns down. The price’s rise above the upper band may be a selling signal, while a decline below the lower band – a buying signal.

The outer bands automatically widen when volatility increases and narrow when volatility decreases. High and low volatility periods usually follow each other, so the narrowing of the bands often means that the volatility is about to increase sharply.


  • We don’t recommend to use Bollinger Bands without confirmation from other indicators/technical tools. Bollinger bands go well with candlestick patterns, trendlines, and other price actions signals.


Bollinger Bands work best when the market is not trending. This indicator can be a great basis for a trading system, but it alone is not enough: you’ll need to use other tools as well.

3. MACD – an indicator that shows the phase of the market

MACD (Moving Average Convergence/Divergence) measures the driving force behind the market. It shows when the market gets tired of moving in one direction and needs a rest (correction).

Technical principle: MACD histogram is the difference between a 26-period and 12-period exponential moving averages (EMA). It also includes a signal line (9-period moving average).

In simple terms: MACD is based on moving averages, but it involves some other formulas as well, so it belongs to a type of technical indicators known oscillators. Oscillators are shown in separate boxes below the price chart. After an oscillator rises to high levels, it has to turn back down. Usually so does the price chart. The difference is that while MACD needs to return close to 0 or lower, the price’s decline will likely be smaller. This is how MACD “predicts” the turns in price.

How to interpret

  1. Dramatic Rise/Fall. Sell when histogram bars start declining after a big advance. Buy when histogram bars start growing after a big decline.
  2. Crossovers between the histogram and the signal line can make market entries more precise. Buy when the MACD-histogram rises above the signal line. Sell when the MACD-histogram falls below the signal line.
  3. Zero line as additional confirmation. When MACD crosses the zero line, it also shows the strength of bulls or bears. Buy when the MACD-histogram rises above 0. Sell when the MACD-histogram falls below 0. Note though, that such signals are weaker than the previous ones.
  4. Divergence. If a price rises and a MACD falls, it means that the advance of the price is not confirmed by the indicator and the rally is about to end. On the contrary, if a price falls and MACD rises, a bullish turn in the near-term.


  • Crossovers between the histogram and the signal line are the best signal from MACD.
  • Hunt for divergences between MACD and the price: it’s a good indication of an upcoming correction.

Advantages of MACD:

  • MACD can be used both trending or ranging markets.
  • If you understood MACD, it will be easy for you to learn how other oscillators work: the principle is quite similar.

Disadvantages of MACD:

  • The indicator lags behind the price chart, so some signals come late and are not followed by the strong move of the market.


It’s good to have MACD on your chart as it measures both trend and momentum. It can be a strong part of a trading system, although we don’t recommend to make trading decisions based only on this indicator.

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