Tuesday, October 16, 2012

How Much Time Does a Trader Spend Looking at Charts?

There are basically 4 types of traders in the market:

1. Scalper
Scalpers tend to enter the market many times a day, each time taking between 5-20 pips. They like to look at the lowest time-frames available; typically the M1 and the M5 charts.

2. Day Trader
Day traders tend to close out their position within a day. They do not have the habit of rolling over their positions and let the effect of swap (or interest rates) kick in. Typically, they look at time-frames of M15 and M30.

3. Swing Trader

Swing traders seek to take advantage of early trends. They get into trades which can last anywhere from a couple of days, to around a week in duration. Typically, they look at time-frames of H1 and H4.

4. Position Trader
Position traders hold trades the longest. They look at the "big picture" and are not concerned with intra-day trends. Additionally, they tend to use swap as part of their strategy because of the length of time they are in the markets. Typically, they look at time-frames of D1 and W1.

So you see, different strokes for different folks. It all depends on your nature and the amount of time you have.

I have seen massively successful traders in all 4 categories.

No comments:

Post a Comment