The Definition of a Forex Trader

forex-trader.jpgDay traders will typically take positions for a few minutes up to a few hours, and day traders usually don’t hold positions overnight. They will also usually use very short-term charts such as the 15 minute charts.

 

Swing traders may take a position for a few hours to a few days or even a week or two. They may use 1 hour or more charts to do so. Conversely, if you are a Swing Trader you don’t want to exit your position in 15 minutes.

 

Position traders typically hold positions for an even longer period of time than the Swing trader and this may last a few weeks or a few months. A carry trade: is one that is made based on the difference in interest rates (short the lower yielding currency to gain returns on a higher yielding currency), and may last for a few years or more.

 

The longer-term the trader is the longer the time periods used for the charts. Typically the use daily, weekly, or even monthly charts is popular. I believe every trader should at least start out with the longer-term charts to determine general trend as well as the significant support and resistance levels. Which one are you?

 

 

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