There are many different styles in forex trading. This is due to the individual personal characteristics that vary according to their personality and interests. No trader has a completely similar trading style.

Knowing the risk profile and personality is very important before choosing what strategy to use. Check out the following discussion. Every trader has a different strategy or styles in forex trading. What is the purpose of using a strategy?

It is nothing but to get consistent profit most simply and conveniently for the trader to do. With a variety of traits and conditions of traders, for example, a trader is a student who tends to have more time, a full-time worker, a freelance worker, and so on - traders have different strategies.

Scalpers, One of the Most Common Styles in Forex Trading

This strategy allows you to only hold positions for a very short timeframe (seconds to minutes). Transactions are carried out short with high frequency and small profit targets. Within 1 hour, traders can open and close positions repeatedly.

This strategy of styles in forex trading is best done if the trader has a lot of flexible time even though the risk tends to be higher as the whipsaw chances also increase. In addition, transaction commissions are also more wasteful.

The profit target of this strategy is usually 1-10 pips per transaction. Scalpers generally stick to the 1-5 minute chart. The scalping strategy is good to do during the opening of the American and European markets when price fluctuations occur. Choose currency pairs with close spreads. 

Avoid pairs with large spreads because the risk ratio will be greater than the reward. Because the scalpers' strategy has a high trading frequency with a small profit target in a short time, the high leverage is used so that it can generate a larger profit percentage.

Day Trader Style

The main characteristic of a day trader is transactions within 1 day. The transaction is completed prior to the close of trade in profit or loss. The time required for 1 transaction ranges from minutes to hours.

Traders feel calmer if they go through the close of a transaction without holding a position so as to avoid news surprises that can disrupt prices. The target day trader's profit is usually 20-40 pips, depending on the currency pair purchased. The choice of currency pair to be traded is the same as a scalper, the currency pair must be volatile in a short period of time.

Meanwhile, to observe price movements, the 15 minute and 30-minute charts are used. In contrast to scalpers who avoid the news, day traders are looking for economic news in the best forex broker that can move the market further.

Swing Trader

This is one of styles in forex trading used by traders who hold positions starting from a few days but less than 1 week. Traders who work or have limited trading time are suitable to use the swing trading style. On volatile currency pairs, swing traders can set a profit target of 50-150 pips or more. 

The chart is used as a guide for transactions using 1 hour and 4 hours. Strategically, they tend to be more conservative than scalpers and day traders. Before moving on, swing traders review several parameters for confirmation. 

So that they are not swayed by price movements in the range of 1 day. They focus more on medium-term trends. Because the profit target is larger, they are not affected by currency volatility and wide spreads. You can definitely learn about this in Didimax forex broker.

Getting to know types of traders will let you understand which style suits you best. Trading can be done in your own style, but you should remember that the essence of every style is to maximize the profit according to your capacity. Hence why learning many styles in forex trading will give you more experience.