It’s not uncommon for traders to feel lost when trying to determine which trading strategies to apply for major currency pairs and exotic currency pairs.
Another thing most traders can’t seem to settle on is whether to become a day trader, scalper, news trader, position trader, or swing trader. All these are different trading strategies.
Knowing which strategy to use can ensure you don’t fail while others succeed. Depending on how you would like to execute your trades, below are some strategies to consider:
- Position trading: It allows you to hold your trades for weeks and sometimes months, making it the best long-term approach.
- Swing trading requires you to trade for one to four hours, where your concern lies in capturing a single move in the Sydney session forex pairs.
- Day trading calls for you to trade for between five and fifteen minutes, with the idea being to capture intraday volatility. Here, you must trade the most volatile session.
- Scalping isn’t an ideal strategy for the Sydney session as the transaction costs can easily take up all your profits.
Knowing which strategy works best for you can help you save weeks of wasted effort, time, money, and endless frustration. Ensure you ask yourself three questions before trading:
- Are you looking to make an income or grow wealth with your trades?
- How much of your available time can you set aside for trading?
- Which forex trading strategy suits you the best?
You should learn to draw support and resistance to make it as a trader. Without this, you’ll likely use the wrong strategy, causing you to experience untold losses.