Forex Traders - What's Your Timeframe?

Forex Traders - What's Your Timeframe?

by Harold Hsu

Have you ever asked yourself what kind of trader you want to be? If you haven't, it's important that you take your time to decide which timeframe you're most comfortable with trading in. Yes: the timeframe you like to trade in will determine the type of trader you'll be. Here are 4 of the most popular types of traders: scalper, day trader, swing trader or position trader. Let's go into a little more detail about them in this article.

Are You A Scalper?

Scalpers trade in very short time frames using minute charts and sometimes hourly charts. They look for small profits of about 5 to 15 pips in each trade that they take. As such, scalpers typically enter into more than one or two trades a day. They are constantly entering and exiting their trade positions in search of every small opportunity for a profit. A scalping trade can be over in as short as 20 minutes.

Are You A Day Trader?

Like scalpers, day traders typically use minute and hourly charts to trade with. Also similarly with scalpers, day traders don't hold any of their trade positions overnight. They always exit their trades by the end of each trading day.

However unlike scalpers, day traders usually hold their trade positions for at least few hours. As a result, their gains and losses are also larger than that of scalpers per trade.

Are You A Swing Trader?

Swing traders trade in intermediate timeframes that can last from a few days to a few weeks. They look to ride along an entire up- or down-swing in order to profit the most out of each major price fluctuation wave. As you can guess, they normally use hourly, daily and weekly charts to trade with.

Are You A Position Trader?

Position traders usually hold their positions for more than two weeks, and are typically fundamental traders. They aren't too interested in the everyday price fluctuations of the market, and prefer to look at the big picture of where a currency pair might be headed. They use mostly daily, weekly and monthly charts.