Types of Traders: Scalpers, Day Traders, Swing Traders & Position Trading
Best Forex Trader Type - Types of Traders - Types of Best Traders
There are different types of Forex traders. The type of a trader one is depends on the amount of time which they hold their open forex trade transactions.
Different Types of Traders also use Different Chart Time Frames to Place Their Forex Trades
The different types of forex traders are:
- Scalpers
- Day traders
- Swing traders
- Position Forex traders
Each type of Forex currency trader is explained below and as a beginner trader you can decide which type of forex trader you want to become based on your trading personality and the forex chart time frame that you would want to be forex trading with.
Scalpers - Scalping Forex Trading
The Forex traders who are scalpers hold on to their forex trades for only a few minutes. With the objective of making a small amount of pips in profit, 5 to 10 to 20 pips.
Scalpers are the type of Forex traders that make many forex trading transactions in one day and participate in Forex trading during the busiest market hours of the FX trading market. A scalper forex trader can open anywhere between 30 to 50 forex trades per day.
Scalpers are Forex traders that can make quick trade decisions.
Scalpers use 1 min charts to put their forex trade orders. They use 5 minutes Forex chart time frame to determine the trend direction, if the trend is going up or down and to decide their entry and exit.
Scalper 5 minutes forex time frame trading strategy
A Scalper using 1 min Forex trading chart time frame wants to go long, checks 5 minute chart, looks like the example below, since it shows the trend is going up, the scalper will then decide it's okay to buy the currency pair.
Types of Traders - Scalpers
Day Traders - Day Trading Forex
Forex Day Trader - This type of Forex trader holds on to their forex trades for a few hours but not more than a day. With the aim to make quite a number of pips in profit, 30 to 70 pips.
The forex day trader makes 2 or 5 forex trading transactions in one day, participating during the busiest times of the market & they do not hold their orders overnight.
These Forex traders use the 15 min charts to put their orders. They use 1 hour forex chart to determine the market trend, if it going up or down & to decide their entry & exit.
Forex Day Trader 1 Hour time frame trading strategy
A Forex day trader using 15 min chart wants to go long, checks 1 hour forex chart time frame, it looks like the example below, since it shows the market trend is going up, the forex day trader will then decide it's okay to buy the currency pair.
Types of Forex Market Traders - Forex Day Traders
Swing Traders - Types of Traders - Forex Swing Trading
Forex Swing Traders - This type of forex trader holds on to their Forex trades for few days to a week - with the objective of making a large number of pips in profit, 100 to 400 pips.
This type of forex market trader makes an average of 2 to 5 forex trading transactions in one week, holding onto their trades overnight. Swing forex trading method requires forex traders who are patient.
This type of forex trader uses the 1 hour Forex charts to put their orders. Swing traders use the 4 hour forex chart to determine the Forex trend, if it is going up or down and to decide their entry and exit.
Forex Swing Trader 4 Hour chart time frame trading strategy
A forex swing trader using 1 hour forex candlesticks charts wants to go short, checks 4 hour forex candlesticks chart, it looks like the example below, since it shows the trend is going down, the swing forex trader will then decide it's okay to Sell/Go Short the currency pair.
Types of Foreign Currency Traders - Swing Traders
Position Traders - Types of Traders - Position Forex Trading
Position Traders - This type of foreign currency trader holds on to their forex trade for weeks or months. With main objective of making a big amount of pips profit, 300 to 1000 pips.
Position Traders place an average of 2 to 5 orders in a year, position forex trading method requires those who are patient, experienced and have huge account balances that can withstand huge draw-downs.
Position forex traders use 1 day or weekly forex charts to put their orders. They use weekly forex chart to determine the trend, if it going up or down and to decide their entry and exit.
Forex Position Trader Weekly Chart Timeframe Trading Strategy
Position forex trader using the daily forex candlesticks charts wants to go short, checks weekly forex chart time frame, it looks like the example below, since weekly forex chart time frame shows the trend is going down, the position forex trader will then decide it is okay to sell - Go short.
Types of Traders - Position Traders
What is the best Forex Trader Type? - Types of Traders
The most popular type of Forex trader or the best Forex trader type is the day trader & scalper forex trader depending on the method of forex trading of each trader, but these two forex trading methods are the most widely chosen forex trading methods. Scalping forex trading requires those that can make quick decisions while forex day trading is for those who want their forex trades to run for longer and have more time when making forex trading decisions. When starting it is best to try forex scalping or forex day trading. These forex methods are the best because you do not leave orders open for too long. At the same time you do not leave forex trades open overnight and you can trade when you have time to watch the forex market movements. In Forex trading it is best keep orders open for as long as the trend setup is in your direction and exit immediately once the trend direction starts to reverse.
When it comes to the question about which type of forex trading style is used by the best Forex traders or by the top Forex traders the two forex trading methods above are the most commonly used forex trading techniques. Traders can also automate these scalping or day trading styles by implementing their forex strategies using automated forex robots.
For forex swing traders, leaving forex trade transactions too long can also take up your profit & this forex trading method also requires a lot of skills so it is best to stick to the short term forex trading methods for most beginner Forex traders.
Position forex trading is not good as it requires a huge forex account balance and sometime it can result to huge draw-downs.
For forex swing trading & position forex trading methods, leaving a forex trade transaction open for too long, may mean these forex trades can reverse and move against you with a lot of pip movements and can even wipe your forex trading account, for this reason swing trading & position forex trading methods are not very popular. It is best to stick to forex scalping and forex day trading so as to better manage the funds in your forex trading account.
It is not recommended for the Forex trader who is a beginner to leave forex trade orders open overnight, it is best to always close open orders at the end of the day.
Forex News Traders - this forex news trader places orders during economic news release time, either guessing the news will be positive/negative or placing pending forex trade orders above & below the forex market price. Forex News trading method is risky as volatility is massive during these News Release Times, whilst at the same time liquidity may be non-existent. You forex trade orders may not get filled, your order to open a trade may get requoted or your stop loss might not be filled! Forex News Trading method can be suitable for some forex traders but requires some skills.
Robot Traders - Automated Traders - the Forex robot trader - automated forex trader is the type of forex trader that uses automated forex trading programs known as Forex Robots - EA Robots Expert Advisors Robots to trade the online forex currency market. This automated forex trader will install an Automated Forex Robot on their forex trading platform & the automated trading robot will then open and close forex trades on behalf of the trader based on the automated robot trading strategy which has been used to program this automated forex robot. If you are new to automated forex trading & would like to find a trader using automated forex trading robots to help you come up with an automated robot, then you can find out more about automated trading on the Expert Advisors Article - MQL5 Forex EA Robots Forum.
