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Trading Styles



Analysis Types



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Trading Styles


Active trading is the act of buying and selling securities based on short-term movements to profit from the price movements on a short-term stock chart

The mentality associated with an active trading strategy differs from the long-term's buy-and-hold strategy found among passive or indexed investors.

Active traders believe that short-term movements and capturing the market trend are where the profits are made.



Your trading style could be:

Long term
Intermediate term
Short Term
Months to years hedging
Swing Trading
Momentum Scalping
Long term
Months to years hedging
Intermediate term
MSwing Trading
Short Term
Momentum Scalping
 


Short Term Trading (Also referred to as Day Trading)

Scalping

 

  1. Lasts for a few seconds
  2. Profit target is around 5-10 pips
  3. Benefit from a small reversal in market
  4. Dependence on technical analysis is maximum (100%)

 

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Momentum

 

  1. Lasts for a few minutes
  2. Profit target is around 20 - 50 pips
  3. Benefit from a major reversal in market/news
  4. Dependence on TA is 610%, FA 40%

 

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Medium Term Trading

 

Swing Trading

 

  1. Lasts from 1 day to around 3 weeks
  2. Profit target is around 100 - 150 pips
  3. Benefit from major moves in the market
  4. Dependence on technical analysis is minimal (up to 20%)
  5. Fundamental analysis constitutes 80% of decision making

 

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Long Term Trading

 

Position Trading

 

  1. Lasts more than a month
  2. Can last for as long as two years
  3. Profit target is big, over 500 to 600 pips
  4. Dependence on technical analysis is minimal (up to 20%)

 

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RISK WARNING

CFDs are complex instruments that come with a high risk of losing money rapidly due to leverage. Whilst leverage enables traders to magnify their profits on successful trades, it is still possible for significant losses to occur; around 78% of retail investor accounts lose money when trading CFDs.
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