When choosing a forex trading strategy, it helps to be aware of what type of trader you are and what types of strategies exist. However, it is not as simple as selecting a single trading strategy, as traders can choose to employ a single strategy or combine several. But, my suggestion is research about best forex strategy first, then start.
The Best Forex trading strategies are:
Perhaps the major part of Forex trading strategies is based on the main types of Forex market analysis used to understand the market movement.
1. Forex Technical Analysis Strategies.
What is Forex technical analysis? Forex technical analysis is the study of market action by the primary use of charts for the purpose of forecasting future price trends. Forex traders can develop strategies based on various technical analysis tools including
* Market trends
* Resistance levels
* Chart patterns
Scalping is a very short-term trading strategy that involves taking multiple small profits on trading positions with a very short duration. Scalpers need ultra quick reaction times because they usually enter and exit trades in just seconds or minutes. This very fast paced and a rather stressful activity that may not suit everyone.
3. Forex Trend Trading Strategy.
What is a Forex Trend? Much like any other trend for example in fashion- it is the direction in which the market moves. More precisely and good to know, the foreign exchange market does not move in a straight line, but more in successive waves with clear peaks or highs and lows.
4. Day Trading
Day trading is another short-term trading strategy that is followed only during a particular trading session. Day traders generally do not take overnight positions, so they close out all trades each day. This helps reduce exposure to market movements when the trader is inattentive to the market.
5. Support and Resistance Trading Strategy.
In order to fully understand the core of the support and resistance trading strategy, traders should understand what a horizontal level is. A horizontal level is:
A price level indicating either support or resistance in the market. In technical terms – price lows and highs respectively.