The strategy helps the traders to buy and sell the asset at the right time and thus make good profits. But, most of the time, traders can’t find out the right strategy for them. Sometimes, they applied the wrong strategy at an inappropriate time. For this reason, they faced big problems. However, to become successful in trading, traders need to choose the right trading strategy so that they can get success. For choosing the right trading strategy, it’s important to know about the different types of strategies properly.
However, there are some plans which are suitable for the newbies, and some plans are suitable for the experts. In this post, we will discuss these strategies in detail. We hope, it would become helpful for you.
Price action trading strategy
In this trading strategy, traders mostly use technical analysis. They hardly use the fundamental analysis to ply the price action trading strategy. However, to apply this strategy properly, traders must interpret the chart patterns properly. Or else, they can’t get a good result. As a trader, you can use this plan in different periods. However, this is seen, some traders prefer to choose the average timeframe to apply this strategy.
Learning about the price action trading method is not that easy. But you can reduce the stress by using a paper trading account from Saxo broker Dubai. Stick to the paper trading account as long as you want. Once you become comfortable with your actions, start trading with real money.
Range trading strategy
Traders apply the range trading strategy during the consolidation period. In this plan, they identify the support and resistance, after that place the trade these levels. However, during the consolidation period, the price of the currency pair hardly fluctuated. For this reason, traders need to ply this specific plan. But, in terms of using this strategy, traders must aware of the risk-reward ratio. Because minimizing the risk is one of the crucial aspects of this strategy. But, if they can find out the asset with a favorable risk-reward ratio, they might get the rewards. To find out the good risk-reward ratio, they need to use some particular indicators such as oscillators, RSI, and stochastic.
Position trading style
Position trading style is known as the long-term trading style. Generally, traders choose the higher time frame to use this strategy. To ply the strategy properly, traders need to contemplate the fundamental factors. Mostly the major news plays an important role in terms of applying this method. However, being a retail trader, you also need to use technical indicators to find out the proper entry and exit points. Position trading strategy is beneficial to the newcomers because it requires low investment and provides the opportunity for traders to trade with a high risk-reward ratio.
Day trading style
Day trading style is for the short-term investor but it’s very popular among the traders. But, it’s highly risky for the rookies because they can’t figure out the problem within a short time. Day traders buy and sell their currency within a day. So, being a trader, if you are not efficient, you can’t ply the day trading strategy properly. However, to find out the entry and exit level, pro traders use different types of indicators in day trading such as momentum, moving average, crossovers, MACD, and so on.
If you want to become a professional trader, then, quick scalping will not be the right choice for you. But, as a beginner, you can choose this strategy. Because you don’t need to gather much knowledge to become a quick scalper. But, if you are not emotionally strong, you should not choose this. Because it requires strong mental ability. In this strategy, you will get plenty of time to open and close the position. So, if you can’t handle your emotions, you might face a big loss.
So, these are some well-known strategies for the traders. However, being a retail trader, you need to choose the right one for you so that you can make large profits.