Getting into forex trading without having one or two strategies you plan to use is like going camping without your tent and lights.

What exactly are you going to do in the forex market if you have no strategy at your disposal? How do you intend to invest and trade currencies if you have nothing to rely on to guide you?

Having a strategy is one sure way of getting ahead. Sometimes, traders arm themselves with two strategies to ensure they do it right. This usually depends on your level of expertise or personality.

If you intend to get into forex, pay attention as we discuss 4 common forex trading strategies you could use.

Scalping

In cases where a trader wants to make short term market moves and profit from them, they usually use this active strategy to quickly get into the market, make some profit from a few pips and leave.

• They come back again, repeat the same process and leave.
• This scalping method allows them make these short and quick moves while ensuring their profits.

Swing Trading

Another name for this strategy is momentum trading. Traders using this method usually buy currencies there are at their low prices and then sell them very high.

• These forex traders get signals to get into the market and when they have completed their trade, they leave.
• These signals come from momentum technical indicators and they usually use overnight positions to trade.
• An example of the momentum technical indicator is the RSI.

Day Trading

Day traders use this strategy to enter positions during the day. They could enter and exit these positions for as many times as they want during the day but close out once the single trading session ends.

The day trading strategy considers the holding of positions overnight as high risk so traders using this strategy avoid holding any positions overnight.

Trend Trading

• First of all, a trend is an established direction of movement of prices over a period.
• Forex investors who make it big have mastered the entry and exit points of these trends to profit high from it.

Now trend trading, unlike the scalping strategy, usually involves a long term trading period in which users rely on the estimates of the intrinsic values and directions of prices to guide them.

In trend trading, as long as the trend is still on, traders continue to hold their positions until the trend ends. This ensures that they profit maximally from the session.

Using strategies, like I said before, helps you stay guided and focused once you enter into the market. You can choose any strategy based on lots of factors like your personality, budget and profit goals. Happy trading!