Jun 05 2021 2
To succeed in the forex market, traders must have a suitable forex trading strategy that fits their style and trading conditions. Today, we will show you the 4 professional trading strategies PDF that most professional forex traders use.
The definition of scalping trading strategy
Speaking of scalping strategy, it allows traders to gain profits during periods of price changes. It is a fact that traders need to conform to a strict strategy if they do not want to lose their profits. It is a must-do task for traders to have adequate trading tools, including live feed and stamina, if they want to achieve success with this trading strategy.
How to apply scalping strategy
In order for us to know how to start scalping strategy, it requires us to understand how it works. Basically, it works based on a hypothesis that the majority of stocks will finish the initial step of a movement. After doing this, several stocks will stop upgrading.
The ultimate of trading forex is to make profits. Therefore, scalpers normally want to gain as much as they expect. In fact, this strategy can be achievable as it increases winners and losers win size. In reality, traders can make profits with a long-term time frame when they win half or less than half of their trades. It should be noted that traders will achieve good results if their ratio of winning is higher than loss one.
The best brokers for scalping strategy
Basically, scalping means you open and close your trading positions very quickly, and you will be trading a lot of positions in a day. So you will need a broker with low spread and low commission. Spread is the difference between the Buy price and the Sell price. Lower spread means less loss. Commission is charged whenever you complete a trade. Because you trade multiple times a day, you will need low or no commission. Here are some brokers with low spread and low commission:
The definition of day trading strategy
Day trading strategy is the buying and selling transaction of forex instruments in a short period of time. In other definitions, day trading is about settling, buying and selling during a day. However, day trading may be longer to a few days or a month. Normally, brokers may finalize these transactions. By the internet today, single investors may do it.
How to apply day trading strategy
The business strengths are not enough attention of traders following day trading strategy. They are based on technical analysis or price trends.
Stock is no single factor of day trading. Other instruments applied are options, futures, commodities and currencies. There are advantages and disadvantages of day trading investment.
Day trading strength is the in-day profit making with a big trading regularity for increased profits optimization. Investors therefore have advantages from trading size and speed to enhance the money making with a small movement. There are 2 important functions of day trading which are keeping market efficiency and adding liquidity.
However, the sickness is the high-speed and high frequency. Hence, no compliance to trading discipline will lead to losses. While there are traders with ability, luck, discipline and bravery in this risky game of getting high frequency trading, sophisticated computer programs are used to address trading orders to the market in high frequency trading.
The best brokers for day trading strategy
So for day trading, you will need brokers who allow you to trade bigger volumes because you only trade during the day. You don’t keep your positions overnight. Moreover, pick brokers who have less slippages because big slippage can mess up your trades. Here are the most suitable forex brokers for day trading:
The definition of price action strategy
To put it simply, price action strategy is when you trade based on the actions of the prices. Sometimes, the price will react to certain events in the world in a certain way. We can view those as signals. When you spot a price action and you trade according to the experience of such action in the past, you are using the price action strategy. Thanks to the advance in technology, you can spot price actions by using a variety of technical indicators.
The best brokers for price action strategy
So you can see that price action strategy is all about indicators. Therefore, the best forex brokers for this strategy is the one with platforms that allow you to use as many indicators as possible. Here are the top forex trading platforms for price action strategy:
The definition of swing strategy
To put it briefly, swing trading strategy is a trading style that lasts for long and requires patience from traders to hold their positions for up to days. It is suitable for traders who don’t have time to keep up with the charts during the trading day but can spend hours analyzing the market and giving predictions at night. These people are usually those who have full-time jobs or still go to school. They only have a few hours a day to stay up-to-date with the market trends and current economic situations.
How to apply swing strategy
Swing traders will look for “swings” in a relatively medium trend. Only when there is a high chance of winning do they decide to take part in the market. When they see an uptrend, they will go long (buy) at the low part of the swing and go short (sell) at the high part of the swing. Their aim is to take advantage of temporary counter-trends.
When you try the swing trading strategy, your trades regularly last for days. Therefore, you will need to set larger stop losses in order to overcome volatility. Pay attention to that and put it in your money management plan. And of course, sometimes you will encounter trades that go against you when you’re holding the positions because the price of a currency pair can be very fluctuated during the shorter time frames. So it’s vital for you to remain a cool head. Have faith in your analysis and predictions. Swing traders don’t care about spread because they are aiming at a very large amount of money. They are ready to trade with pairs that have high spread and low liquidity as long as they are easy to analyse.
The best brokers for swing strategy
You need many good indicators for swing trading strategy. The only way to do that is to trade with brokers who have advanced and modern trading platforms. Here are the brokers who have a variety of forex indicators on their platforms:
The definition of news trading strategy
News trading strategy can be easily broken down into predicting how certain news and events can affect the market and planning trades accordingly.
How to apply news trading strategy
News-based trading has several different approaches. First, some forex traders try to predict the outcome of economic releases and based on that place a trade before the news is released.
When predicting economic data, there are sometimes clues ahead of economic news releases. For example, in forecasting US employment data, you can use the employment component index in PMI reports. If this indicator of the three reports increases from the previous month, it shows that the number of new jobs created also increased.
The second strategy of news-based forex trading is to wait until the numbers are released and trade based on how the market reacts. For example, if retail sales in the US exceeded expectations by a large margin, you could go short in EUR/USD, based on the predicted strength of the US dollar.
Regardless of the fundamental data, the third forex trading strategy considers only the previous price factor. In other words, forex traders don't start with price trends. A popular strategy of this type is to trade the breakout from the previous range taken as the initial steps. This can be done during both short-term intraday and daily times.
The best brokers for news trading strategy
All the following brokers have an economic calendar on their platforms and a team of experts who analyze and predict new trends, events and financial news. Any news trading strategy users can take advantage of this feature. Those brokers are:
Those are the 5 professional trading strategies that we believe you will benefit a lot from each of them, as long as they suit your time and funding.