Types of forex traders, which one are you?
By now, you probably have read and understood a glimpse of the Forex world. The next step for you to learn Forex is to pick a strategy. The global market of Forex has created different types of traders and they are grouped based on the strategy they pick. Out of many, we are going to discuss 3 main types of Forex traders!
Why Focus on One Strategy?
There are so many strategies out there. By looking at these three types of trading, you can even see that they are the opposite of each other. Focusing on one strategy is good so that you can be discipline in one instead of trying too many. Trading in Forex can be emotionally draining.
Sometimes you just want to follow your emotions, but this can't be good. By having one strategy you are keeping yourself out of doing things irrationally. If you understand one strategy and masters the tools and techniques, your potential to be successful in Forex market is higher and you will have a clearer picture on the journey.
• Day Trader
This is the first and most known type of trader. Just like its name, day trader only holds their trades for a day which make them a short-term trader. They can hold it for minutes or hours, so everything goes fast. Because they are not planning for long-term, this strategy doesn't require you to keep up with the economy.
The risk is high with this strategy, and you have to constantly be in the market because of the quick changes. But, the potential is also high and you could really make a lot of money with this strategy. This is because the leverage provided by
Forex broker is higher than other type of investments.
• Swinger
Swinger is sort of in the middle of short-term and long-term trader. You can hold this for days or weeks. What's best about this strategy is that you don't have to constantly watch the markets. They analyze the fundamentals, which makes them focus on the macroeconomics of countries. They would need to be updated with the news.
Usually, swinger is more interested in huge news that could affect their trading position big time. So instead of technical analysis, swinger focuses more on fundamental analysis. With fundamental analysis, they are seeking for potential trends and patterns of the global market. This type of analysis that sees on what’s happening in the world suits swinger best.
• Scalper
If you think that day trader is the fastest, then you haven't met scalper trader. This strategy requires you to hold trades for seconds or minutes. Because it is necessary to be fast, this is done with the help of some tools, which cost can be quite high. With this strategy, trader is seeking for small profit but with high amount of transaction. In one day, they could enter the market around 10 times, or even more.
Because everything happens very fast in this type of trading, this is not for someone who just starts learning Forex. If you want to be this kind of trader, you have to start paying attention on details that perhaps other traders don't really care about. It takes a fast thinker to be a scalper, and if you are good at deciding on taking actions quickly, then this strategy suits you best.
How to Pick Your Own Strategy
You have to know your own preferred style of trading. Each of these traders strategies are not for everyone, and choosing what suits you best can be challenging. That's why you should have mentors that can teach you to learn Forex and choose the most suited strategy for you. Broker companies like Didimax provides high quality mentors that you need. You can consult them to know which trading strategy is best for you and they will tailor it based on yourself.