Technical traders have main types of trading to choose from which is scalping, day trading, momentum trading, position trading and swing trading. However, mastering one of type of trading is very much essential but it is important for the traders to be proficient in others as well. It is best to stay out of the market but in doubt. Standing aside is considered to be a defensive option and there’s no harm in waiting for the right opportunity. In this article, we will be discussing about the major types of trading mentioned above. Continue reading, to know more
Scalping, also known as micro trading is about taking small profits constantly. It is considered to be strategy attempting to make various profits on small price changes. Traders implementing this strategy will place from 10 to a few hundreds in a day. However, scalping is not recommended for the beginners as it requires expertise skills.
Day trading refers to buying and selling on the same day without holding on. It holds positing from sec to minutes and is considered to be one of the best ways to get rich rapidly. However, initially there will be high chances of uncertain loses but gradually there will hold a good position. Day trading requires firm discipline, time and ability to learn on how to trade a tested and profitable strategy at a faster pace.
The trader will be identifying a stock which is breaking out and would jump on it to capture as much as the momentum on the way as much as possible. The focus of the traders will be on the stocks moving significantly in one direction on a high volume.
Swing trading is an art referring to the short term trend. In this style of trading, the trader attempts to capture profits in a stock within 1-7 days. The swing traders use the technical analysis in order to look for stocks with the short term price momentum. The swing traders focuses on their price trends and patterns instead of the fundamentals or the intrinsic value.
Position trading refers to trades for weeks to months. The position trader will endeavor to anticipate whether or not the current trend will continue for a longer duration than the momentum trade or the swing trade. Position trading is best for traders who don’t frequently trading, as this style of trading gives them a lot of benefits such as the profit potential will be diminished.
Hope, this article has been informative to you. Thank you for reading.