Top 3 successful forex trading strategies and How they work

A Forex trading strategy is like the step-ladder you would use to get to the top of a building. Ideally, a Forex trading strategy is your step-ladder for success in forex trading. You plan to win, then no doubt what you need is to settle for the best trading strategies that have been proved to work by fellow successful traders.

Our advice of all time; start small then go big with larger trading amounts as you become more experienced with the strategy.

Probably as a beginner the question you must be wanting an answer is; what are the successful forex trading strategies and how they simply work. Here is our quick preview of top 3 forex trading, which most successful traders have attributed their success to: -

1.      Scalping trading strategy

Scalpers traders engage in short-term trading session. As a scalper, all you need is a quick reaction time frame because you will enter and exit trades within seconds or few minutes. With such tight timelines and its fast-paced nature, scalping is not for everyone. Being a scalper, you will be tasked with keeping an eye closely on price charts for patterns signaling future market swaps.

2.      Position trading

Positional trading is a strategy that will need you to have your positions opened for longer than the Scalpers and Swing traders. The longer period is to allow you the trader to get hold of some big market moves. It’s an ideal strategy for getting high profits from your trading amount. Though it may test your emotions as you watch your money being affected by short-term market moves. What you need to know with positional trading is invest your time in analyzing the market to predict future moves, and abstain from applying high leverage.

3.      Swing or Momentum trading

The swing or momentum trading strategy is a medium-term one that focuses on capturing several market moves. As a swing trader, your choice to enter and exit a position will be purely based on momentum indicators. The momentum indicators are responsible for signaling buy and sell decisions. The mostly applied Momentum indicators are; Moving Average Convergence Divergence (MACD) histogram and Relative strength index (RSI).

Parting shot

Not all strategies will work for every trader. The best thing is to select a strategy that best suits your needs in terms of time, your personality and level of risk tolerance. It advisable to pick one that works for you, remember it’s a game of trial and error. So, take the chance to try out each of them, change and improve, develop yours which could probably be the most perfect fit for you.