Good Traders, Bad Traders (Part II)
Can you be a scalper? Yes, forex scalping is something that many of us do. Forex scalping is best suited to the time when the market is ranging. Scalper is a workable profile for a small retail trader. However, you should be able to view the overall trend of the market to gauge whether you are trading with or against the prevailing trend.
A scalper might use a 10 minute chart to follow the market, a 1 hour chart to determine the long term trend and the 5 minute chart to time the entries and exits for each trade.
Day trading is something that many people are successfully doing from the comfort of their homes. There are many people who now make a living from day trading. In day trading, you open a trade and close it before the end of the day. That means you do not keep it open overnight usually. Day trader is a good profile for a new trader.
A position trader is always for the lookout for big market moves that can get him/her 100-500 pips per trade. He/she might use a 1 hour chart to track the market, the 15 minute chart to time entries and exits and 1 day charts for trend determination.
Position trading is long term like a few months to a year. A lot can happen in few months to a year. The whole world can go topsy turvy. The important question is can you make an investment for that long and survive looking at it for that long.
If you aim for a 1/3 risk/reward ratio, a Guerilla will risk 5-10 pips per trade, a scalper will risk 15-20 pips per trade, a day trader will risk 25-30 pips per trade and a position trader will risk 40-50 pips per trade. Each profile requires different scales of charts and time frames but also indicators and money management parameters.
Always keep in mind that in forex trading a 10 pips move up or down can easily occur within seconds or minutes very quickly without any reason or rhyme. No two traders can be exactly alike. Even if two traders use the same charts and technical indicators they might interpret them differently.
The differences in money management techniques and attitudes are much less. Good traders tend to share money management and attitude traits. So do bad traders. Do you want to become a good trader or a bad trader? - 23212
A scalper might use a 10 minute chart to follow the market, a 1 hour chart to determine the long term trend and the 5 minute chart to time the entries and exits for each trade.
Day trading is something that many people are successfully doing from the comfort of their homes. There are many people who now make a living from day trading. In day trading, you open a trade and close it before the end of the day. That means you do not keep it open overnight usually. Day trader is a good profile for a new trader.
A position trader is always for the lookout for big market moves that can get him/her 100-500 pips per trade. He/she might use a 1 hour chart to track the market, the 15 minute chart to time entries and exits and 1 day charts for trend determination.
Position trading is long term like a few months to a year. A lot can happen in few months to a year. The whole world can go topsy turvy. The important question is can you make an investment for that long and survive looking at it for that long.
If you aim for a 1/3 risk/reward ratio, a Guerilla will risk 5-10 pips per trade, a scalper will risk 15-20 pips per trade, a day trader will risk 25-30 pips per trade and a position trader will risk 40-50 pips per trade. Each profile requires different scales of charts and time frames but also indicators and money management parameters.
Always keep in mind that in forex trading a 10 pips move up or down can easily occur within seconds or minutes very quickly without any reason or rhyme. No two traders can be exactly alike. Even if two traders use the same charts and technical indicators they might interpret them differently.
The differences in money management techniques and attitudes are much less. Good traders tend to share money management and attitude traits. So do bad traders. Do you want to become a good trader or a bad trader? - 23212
About the Author:
Mr. Ahmad Hassam has done Masters from Harvard University. Try these cash printing Forex Signals from heaven. First trade on your Forex Demo Account!
posted by X - Men @ 7:01 AM
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