In the beginning of your forex trading career, you will have to make some very crucial decisions that are going to define what you will do on the foreign currency exchange in the future.
While there are many decisions which are crucial in this regard including your choice of trading course, trading mentor, and forex broker, there is nothing more important than your selection of trading style.
You will find and be relieved to know that the foreign exchange is extremely versatile in that it can support the preferences of virtually every trader because it allows for various trading styles.
One of the styles which seem to suit the majority of new traders in the forex market is that of day trading. Therefore, if you have just decided to start trading on the foreign exchange then you should find out more about day trading because it just might be perfect for you too.
Day Trading Is a Full Time Process
The first thing you should understand is that day trading is a full time process which means that if you are only interested in part time trading then you should look for other trading styles.
In other words, if you have other commitments in life such as another job then you cannot commit to day trading and should try to look up other trading styles which can be used on the foreign currency exchange.
Trades Are Never Left Open Overnight
Day trading is a process where you will never be leaving any trade open overnight. This is an important characteristic because it means that at the end of the day, you will be able to relax and not worry about the fate of your money which is active on the foreign currency exchange. Usually, your positions will be open for anything between a couple of minutes and a whole day.
Day Traders Need to Be Disciplined and Patient
If you are not an inherently disciplined and patient individual and you think that these are qualities that are beyond you, then day trading may not be the right trading style for you.
Discipline and patience is extremely important for day traders on the foreign currency exchange because sometimes they need to wait for the right opportunities and trends to open positions in the market.
Day Trading Is Mainly Based on Technical Analysis
The majority of day trading strategies you will find on the foreign currency exchange will rely primarily on technical analysis because fundamental factors do not play a major role in time periods as short as a single day. However, this also means that you will be spending a lot of quality time with your forex charts.
You Could Place a Maximum of Five Trades a Day
Day traders are not like scalpers in that they do not place countless numbers of trades on the foreign currency exchange in a single day. In fact, while there is no limit to how many trades a scalper can place in the forex market, a day trader usually never exceeds five trades in a single day.
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