Different Types of Traders

And the types that will make you money today!

What 4 Trading Strategies are There?

  1. Scalping

Scalping is the shortest-term trading strategy. Scalp traders only keep positions open for a few seconds or minutes. Small intraday price changes are the focus of these short-term trading. Because of the large number of deals completed in each trading session, the goal is to make a lot of quick trades with little profit gains and let profits compound throughout the day.

Tight spreads and liquid markets are required for this type of trading. As a result of the liquidity and huge trading volume, scalpers prefer to trade large currency pairings like EURUSD & GBPUSD.

They also tend to trade just during the busiest moments of the trading day, when there is more trading volume and typically volatility, such as during the overlap of trading sessions. Scalpers seek the smallest spreads possible since they enter the market so frequently that paying a larger spread will eat into their potential profits.

Many traders find the fast-paced trading environment of trying to scalp a few pips as many times as possible throughout the trading day frustrating and time-consuming, considering that they must focus on charts for several hours at a time.

  1. Swing Traders

Unlike day traders, who often maintain positions for less than one day, swing traders generally hold positions for multiple days, if not weeks. To capture short-term market swings, traders do not need to sit constantly monitoring the charts and their trades throughout the day because positions are kept over time.

This makes it a popular trading technique for persons with other obligations (such as a full-time work) who want to trade in their spare time. However, it is vital to devote a few hours a day to market analysis.

Trend trading, counter-trend trading, and other trading tactics are common among swing traders (as well as some day traders). The most common are trend breakouts and fib retracement level reversals.


  1. Day Trading

Day trading may be suitable for those who are not comfortable with the rigours of scalp trading but do not want to keep positions overnight.

Day traders, unlike swing and position traders, initiate and leave their positions on the same day, eliminating the possibility of huge overnight changes. They close their trade with a profit or a loss at the conclusion of the day. Because trades are typically held for minutes or hours, enough time is required to analyse the markets and monitor positions periodically throughout the day. Day traders, like scalpers, rely on little gains over time to develop profits.

These types of traders focus on small movements within a 15minutes-2 hours time frame, and rely on indicators such as SMA (slow-moving averrage) and oscillation projections/Bollinger bands.


  1. Position Trading

Position traders are interested in long-term price movement, hoping to benefit as much as possible from large price shifts. As a result, trades typically take weeks, months, or even years to complete. Position traders typically analyse and evaluate markets using weekly and monthly price charts, using technical indicators and fundamental analysis to find suitable entry and exit levels.

Position traders' positions do not need to be monitored in the same way as other trading methods since they are not concerned with little price swings or pullbacks; instead, they should be monitored on a regular basis to keep an eye on the major trend.


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None of these types of trading are limited to buying. With certain types of instruments, the trader can also short (or short-sell) the stock. This means that profits can be made in both rising and falling markets.

When choosing a trading type to suit your needs, here are some questions to ask:

    • Am I short-term- or long-term-orientated?

    • How much time do I have during the day to trade?

    • Do I work full-time?

    • Am I patient, or do I need to see results quickly?


What Type of Trader Should I Be?

First and foremost strategy is to acquire complete knowledge about Forex. You should know all the tactics to maximize profit and minimize loss. It can be done when you completely familiarize yourself with market systems and players in the market.

To learn the forex trading language is essential. You cannot survive in foreign market if you do not learn its language. Like, increase in one hundredth percent ($ 10 or $1) increase in trading currency value is represented by PIP. Volume means the quantity or amount of currency you are trading. Buying refers to acquisition of currency. Selling refers to putting the currency into market because of the possibility of decrease in currency value in near future.

Develop your trading strategy according to your trade type. Identify that which kind of foreign market trader you are. Sound trading strategy minimizes risk. Apply the policies of proper money management. Do not invest all capital in one large transaction. You should diversify your portfolio of transactions in order to minimize loss. By allocating capital in many small transactions instead of large transaction is beneficial as if you loss in one transaction you will loss only a fraction of your capital.

We recommend testing them all out with a small budget, and whatever works for you best and makes most sense to you, go for it. Also, time is a big factor. If you don't want to spend more than a day a week, look to use position and swing trading. Everyday? Day trading & scalping etc.

Know The Right Time To Trade

Some people just like being the exceptions to the rule for the sake of it. However, that kind of attitude is dangerous for a Forex trader to adopt. More often than not, it will lead to heavy trading losses, enough to break the bank for good. Timing is everything in Forex trading. You may like to think it as a subjective factor, but studies show that timing is actually objective. Numerous experts have proven with their case studies that the best time to trade in the Forex market is between 1900h – 1100h in UK time, which in Eastern Time will be around 1400h to 0600h.

Automating Forex Trading (Outside the 4 Types) - Advantages and Process

The present day witnesses a technological boom which determines many changes at all the levels of human knowledge and being. Trading has not been left untouched. Everybody trades in one way or another. It has become a must for survival. You can cope with modern world only if you are open-minded, efficient and hard-working.

People trade all sorts of things, sometimes not even realizing they are actually involved in such an activity. The best example is Forex trading. Individuals often trade currencies, although they don't think of it as such. If they were aware, they would know that they can make serious money of it. And it has become so accessible.

What used to be the exclusivist area of corporations is now at hand for almost everyone, especially with the increasing use of the Internet. All over the world people trade on line. They may as well Forex trade on line, no matter whether rich or not, provided that they are connected to the Internet. This kind of business requires quite simple things, such a secured system which is used to produce signals.

What do I have to do?

  • First before finding signals, research and learn everything you need to know to understand what your putting your money into. Make sure you have an idea of how to draw on a graph and make a bullish (up) or bearish (down) prediction. See more here.

  • To get these signals it is vital for you to have the right system, that particular software which was conceived for the purpose of Forex trading. You can find many systems on the Internet, but we have found one that has worked amazingly:

These automatically generated signals can provide you with the so long wished for opportunity to hit the currency market. You can get them from any kind of media, be it television, newspapers, internet forums. However, there is a risk that the signals you get are sometimes distorted. To avoid it, you must be able to choose balanced unprejudiced automatic signals.

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So, What's Next?

Now that you have got the system, you can proceed to the next step, that of subscribing for automatic alerts regarding Forex trading. You are ready now to receive alerts and get into business. These automatic signals alert you on the entrance and exit value for the main currencies. You know in real time where the Euro stands to the US dollar, so you can trade accordingly all day, the entire week.

  • Whenever there is a change for trading, you receive an alert. It can be sent either to your e-mail or to you cell phone. These alerts really help you to make the wisest decision regarding your Forex trading.

Make Use Of An Effective Leverage

How much leverage you allow yourself to use will always have a considerable impact on your trading strategies and its eventual outcomes. There are many different formulas you can use to compute how much leverage you can afford to use, but at the end of the day the factors listed below will prove most important. Keep it conservative. Always apply a stop-loss point to your strategy.

Risk tolerance levels do not have to be proportionate with leverage. There are always exceptions to the rule, and those are simply an inevitable part of the game. Even if things do not go your way, the above traits will serve to minimize your losses and increase your winnings.

We use the complete system above to reduce our losses and give us confirmation for our manual trades. This is why we trade at a 94% success rate and have earned a lot.

Important Disclaimer:

Want to skip all the hours of learning and losing money in forex and crypto?

With ForexMentor, you can receive 1-on-1 coaching on every aspect of trading - start making money instantly with 24/7 1-to-1 support

(Get it discounted here)

Knowledge & Experience

Those who attempt to day trade without first learning the fundamentals of the market frequently lose money. A day trader should be able to perform technical analysis and understand charts. Charts, on the other hand, can be deceitful if you don't have a thorough understanding of the market.

Discipline

Winning and losing trades is part of learning. It takes time to remove emotion from trades. Accept losses before facing defeat. Day traders rely largely on market volatility to make money. If a stock moves a lot during the day, it may be appealing to a day trader. This could occur as a result of a variety of factors.

Summary Notes

Create a Trading Plan (from the 4) and Stick to It

The best traders in the market always plan ahead and are prepared at all times having compiled an elaborate trading plan after which they always act according to their plans. Creating a plan does not necessarily mean that they trade all the time; novice traders usually accumulate losses because they think that they should be on the market trading all the time. Preparation is an important aspect to any successful trade but at times it’s better to sit tight and wait for the trade to play out; just because the Forex market is open 24/7 does not mean that you should be trading all the time.

Wait for Your Trade Setup to Play Out Good

Traders never anticipate how their trades will play out, those who do lose a lot of money in this manner. Exercise patience when your trade plays out and bear in mind that a good trader can be compared to a lion, an amazing predator due to his great stalking skills, and a patient one at that, always waiting for the perfect opportunity to go for the kill and what’s more when he goes for it he rarely misses. Jesse Livermore once said that big money is made by sitting and waiting, and never by thinking, he adds that it’s important to wait for all the factors to tilt in your favor prior to making the trade.

Trust Your Instincts

Accurate gut feelings are indisputable with one of the greatest Forex traders, George Soros revealing that he depended heavily on his instincts when he traded. Soros said that he relied on his animal instincts and that when he suffered from back pain he used the onset of the pain as a sign that something was wrong with his portfolio. This will prompt him to check whether something was amiss when he might have done the contrary, if he had ignored his instincts he might have incurred huge losses.