There are many things which separate great trader from the good ones. These are the levels of their guts, intelligence, instincts, source of motivation. But still there is a factor which is the most important and is above these all and that is the timeframe on which a trader trades the foreign
exchange or the forex. Most of the common traders trade forex with a single time frame, but masters use the different time-lines to study the trends and execute their trades perfectly. Enter and exit strategies also depend on these time frames. Forex traders can be categorized in the categories given below:
exchange or the forex. Most of the common traders trade forex with a single time frame, but masters use the different time-lines to study the trends and execute their trades perfectly. Enter and exit strategies also depend on these time frames. Forex traders can be categorized in the categories given below:
1. Day trader
In simple words we can say that the trader whose trades lasts for a day. Day traders usually don’t want to hold their trades for more than a day, except few trades. They like to close all their open trades before the session is closed for the day. They trade the most volatile currency pairs using technical analysis on one, five or 15-minute charts. They spent long hours in front of their computer screens.
In simple words we can say that the trader whose trades lasts for a day. Day traders usually don’t want to hold their trades for more than a day, except few trades. They like to close all their open trades before the session is closed for the day. They trade the most volatile currency pairs using technical analysis on one, five or 15-minute charts. They spent long hours in front of their computer screens.
2. Swing trader
These are the second type of traders which trades for longer duration of time than that of day traders. These forex traders hold their positions for few hours to few days or sometimes even for a weak. These forex traders also prefer technical analysis over fundamental analysis. They take their positions by reading hourly, daily and weekly forex charts.
3. The position trader
Position traders are the third type of forex traders. They believe in long term capital gains. They don’t sit in front of the computer screens for long hours. They trade on the longest time frame among these three kind of forex traders. They are usually having long term plan. Their position on a single trade can last for some days, weeks, months or even years. They do take a look to technical forex charts but prefer the fundamental analysis to take the descisions. But it requires you to have big portfolios like a banker, a hedge fund manager or some financial body.
Now according to your portfolio, routines and the time you have decided to trade forex, you can ask yourself, what time frame is suitable for you?
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