Types of Forex Traders
In forex trading, there are various types of traders that traders can meet. There are various types and characters of traders in making buying and selling decisions. There are also different kinds of traders who have different trading periods. These traders have their own basic analysis in determining the steps to pursue profits, and have different considerations in viewing the trading period.
The type of trading is closely related to the character of a forex trader. The character of each forex trader is also different from each other, which is why the types of trading are also different. However, there are still many forex traders who do not know what type of trader a real trader is. Based on their characteristics, there are several types of traders that traders may need to know and then they can determine what type of trader they want. The types are:
Day Trader or Scalper :
This type of day trader has a short frame. Traders open and close positions on the same day or trade per market session only. The time frame used is generally below the hourly frame. Turn over from trades made in one day can be high, because the targeted profit target is also not large, so the trading volume and frequency are enlarged in order to obtain adequate returns, and trade on pairs that have volatility or a wide average day range such as GBP/JPY , GPB/USD with the aim of getting enough profit space for the trades made.
Swing Trader
This type takes advantage of a longer movement and uses a larger time frame because after entry, the trader is aiming for a change in direction or a reversal of the instrument being traded. Positions can be held for several days or weeks. So traders take advantage of every swing high and swing low of price movement. Swing traders are actually part of momentum traders who take advantage of trend and price momentum moving in one direction. Traders will take advantage of the main trend at every correction and when a breakout occurs.
Positional Traders
This is the type of trader who holds long positions for months or even years because they decide to stay with the trend long enough, usually until the main trend in the largest frame shows signs of ending. This type is the opposite of intraday traders because the goal is to achieve maximum profit potential on the main trend rather than following short term fluctuations that occur from day to day. Traders do not in/out the market every day or every week. Even though making decisions also looks at the technical side, positional traders use fundamental analysis modeling to find deviations from a reasonable exchange rate, therefore their perspectives are different. The forex portfolio manager will analyze and consider economic indicators, government decisions, interest rates, etc. to make trading decisions.
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