Since the Forex market is a 24 hour a day 5 day a week global market trading over $3trillion a day there is plenty of opportunity for everyone! You can adopt and use many different strategies to trade successfully.

The main benefit of trading the Forex market is that you can fit trading into your life – whatever you do. You can use trading strategies which enable you to trade during the day or night due to the Forex following the world’s financial markets around the globe – somewhere at sometime people will be trading the Forex market!

So what are the different strategies you can use?

OK well let’s take the smallest trade up to the biggest. The smallest trading position is called scalping. This is one of the most common trading strategies for those who don’t have much time to spend trading and like to be in and out of the market quickly.

To trade this strategy successfully and to get the most profit at the end of the month, the trader should be well-funded. This is because the trader will only look to be in the trade for a few minutes and look to profit from very small moves in the market. The best currency pairs to trade using this type of strategy are volatile pairs like GBPUSD and most Japanese Yen pairs. All traders should look to different time frames to trade in order to confirm market sentiment but the scalper will typically use the 1 minute chart to trade from or possibly the tick chart.

The second of the common trading strategies are those of the intra-day trader. This type of individual has a little more time to spend trading the Forex market and will look at trading from an hour to say a morning or an afternoon. This trader will trade a few times over the day but close all positions by the end of the day. All types of currency pairs are good for this type of trading. This also favours the 5, 15 and 30 minute time frames to confirm price direction.

A swing trader will look at holding positions over night and over the course of a few days. Forex trading can benefit this type of individual as interest can be paid on the open position held overnight depending on the currency pair’s economic relationship. It is also possible that the trader will have to pay interest on their position too – so it’s worth understanding the situation from your broker before trading these strategies. This type of trader will look for market cycles and pick the turning points to trade as the price direction changes and ‘swings’ round. The hourly and daily charts are used for trading strategies as a swing trader.

A longer term trader will look to the larger time frames to trade the hourly, daily and weekly charts to get an overall direction for longer term trading or for investment. This is one of the strategies available to those who don’t have much time to sit in front of monitors watching the market.
There are many Forex trading strategies to learn once you know which of the above categories you fall into. Whichever strategy you use a high percentage of successful trading lies with being able to manage the emotional stress which goes hand-in-hand with trading your own money – your hard-earned capital.

Forex trading may appear easy and manageable. But the emotional stress, demands of decision making and the challenge of trying to understand the market requires more than just a keen interest. It requires you to understand how you work best, to focus and the ability to learn from your mistakes plus much, much more.