Online trading has the potential to be extremely lucrative, regardless of the market you’re exploring. However, you need to spend plenty of time learning all about how online trading works, and then formulate a winning strategy to stick to. Throughout this article, we’ll outline some of the most successful trading strategies.
Trend Trading Strategy
The trend trading strategy involves deep market analysis to highlight potential trends before they come to pass. Following trends sits outside the realms of being “bullish”, and it’s a great way to find success.
You will need to outline several rules to follow when determining a potential trend, and if a trend doesn’t tick all the boxes – move on. It’s important to choose a reliable and reputable broker, such as HFM, to execute trades and provide access to necessary tools and resources for successful trend trading.
To do well with the end-of-day (EOD) strategy, you’ll need to be active near the market close time – this is the window you will open your positions. The theory is that by this time, it’s a lot clearer which direction the price will settle.
You will need to examine the price action compared to the previous business day’s price movements, which will allow you to make a logical prediction on the price’s movement. To avoid significant losses overnight, you have to implement stop-loss orders or take profits.
News Trading Strategy
News surrounding the trading industry breaks daily, and it’s a great way to learn about potentially lucrative trades. To make successful trades based on breaking news, you’ll have to be extremely skilled, especially given how fast technology allows news to spread.
Before making a trade, you’ll have to work out whether the news has already trickled into the price and made a positive change – or only part way. As well as this, you will have to decide whether the market expectations align with the breaking news.
Day Trading Strategy
Day trading, also known as intraday trading, is a great strategy for anyone looking to be plugged in during market open hours. Typically, this strategy will be carried out on full-time bases. No matter how many positions you open in this strategy, you’ll never leave one open overnight, as this helps to reduce the loss.
Swing Trading Strategy
Swing trading is pretty fluid and involves making trades on both sides of a financial market’s movements. For the most part, swing trading means buying when the market is expected to increase in value. When drops are expected to happen, swing traders “sell” their assets.
Being successful with swing trading means having a thorough understanding of reading market charts, which will be used to pick out trends.
Scalping Trading Strategy
Scalping involves making extremely short trades that will see a minuscule price fluctuation. The idea here is that many small wins will eventually equate to a significant win. However, to do well scalping, you need to have a strategy for exiting the market.
Succeeding with online trading involves having a winning strategy. Dip your toes into success with the above information, and then carry out further reading on your favorite strategies.