Posted by
I’m very sure you know that there are several Forex trading strategies that traders use in the market. Some strategies are complex while some are simple, but all aim to profit by predicting the market’s future direction. In this informative article, I will explain the top 7 forex trading strategies. I’ve picked the simplest fired trading strategies so that they will be easy to understand.
If you don’t know what forex trading is all about. Forex trading strategy is a set of rules that you use to determine when to buy or sell currency pairs.
A Forex trading strategy can be automated or manual. Manual strategies need the trader to constantly monitor the market so that he or she will be able to make the right decisions based on their findings. Likewise, automated strategies can be executed by a computer program that automatically makes trades based on a set of predetermined rules.
There are many different Forex trading strategies that traders use to achieve success in the market. Some strategies are more complex than others, but all aim to make profits by predicting the future direction of Forex Trading Nigeria
Top 7 Forex Trading Strategies
1. Price Action Trading
Price action trading is the most popular and easiest Forex trading strategy. It is based on movements in the price of a currency pair. This strategy is considered the purest form of Forex trading, as it is based purely on price action and not on any other indicator.
All price action traders base their trading decisions on the movements in the price of a currency pair and will not use any other indicators or news events to make their decisions.
2. Range Trading Strategy
The range Trading Strategy is also one of the most profitable and best forex trading strategies. Range Trading Strategy is the type of Forex trading strategy that’s based on movements in the price of a currency pair within a specific range. Range Trading Strategy traders take advantage of periods of consolidation in the market, where the price of a currency pair does not move very much.
All Range Trading Strategy traders look to buy a currency pair when trading at the bottom of the range and sell when it is trading at the top of the range.
3. Position Trading
Position trading is also one of the top 7 forex trading strategies because it is based on holding a currency pair for a long time. Position Trading is the type of trading that often looks to take advantage of the long-term trends in the market and can be considered a buy-and-hold strategy.
All Position Trading traders will often hold a currency pair for months and will only look to take profits when the trend has reversed or when a significant move has occurred.
4. Swing Trading Strategy
The swing trading strategy is one of the top 7 forex trading strategies that’s based on taking trades lasting for only a short period. Position Trading takes advantage of the short-term swings in the market and can be considered a more active form of trading than position trading.
All swing traders will always take trades lasting for only a few days or weeks and will look to take advantage of the short-term swings in the market.
5. Day Trading Strategy
Day trading strategy is one of the best forex trading strategies popular among those who open and close trades within the same day. Day Trading Strategy trader takes advantage of the small movements in the market and can be considered a more active form of trading than swing trading.
A day trader takes trades lasting for only a few hours or even minutes and looks to take advantage of the small movements in the market.
6. Scalping Strategy
The scalping strategy is one of the most popular and best forex trading strategies based on taking small profits over a short period. This type of trading often takes advantage of the small movements in the financial market and can be considered a more active form of trading than day trading.
7. Carry Trade Strategy
Carry Trade Strategy is a trading strategy that’s based on earning interest on the currency pairs held for an extended period. Carry Trade Strategy trading takes advantage of the low-interest rates in currencies and it’s considered a more passive form of trading.
A carry trader always holds a currency pair for weeks or months and will look to earn the interest on the currency pair. They also take advantage of any other benefits that might be available from holding the currency pair.
It is very important to know that forex trading strategies can be based on various factors, and you need to decide which one to use. Different traders will have other preferences, and there is no right or wrong strategy.
You can choose any of these forex trading strategies. They are easy and simple to understand forex trading strategies to start your forex trading career in 2022.