In this post, we’ll discuss the most common trading styles on various timeframes, examine where and when they are applied, and how they differ from each other.
• Scalping is a trading style characterized by quick trades on small price changes. Traders look for opportunities to open and close positions within minutes or seconds, usually using technical analysis differences in spreads or liquidity “Scalping” is often associated with high-frequency trading and requires an understanding of market dynamics. It is recommended for experienced traders.
• Day trading is one of the most popular trading styles. Entry and exit from positions are made within one trading day. These are short-term trades, completed within 24 hours. Traders rely on technical analysis , although they may use other methods to enhance effectiveness. It requires experience, so it’s recommended for more experienced traders.
• Swing trading is a trading style where positions are held for several days, weeks, or months. Traders use both technical and fundamental analysis. For beginners, swing trading may be more attractive as it allows for less rushed and more rational decision-making.
• In medium-term trading, traders hold positions in the market for a long time, typically several months, to take advantage of the trend direction. They use technical analysis and fundamental analysis to make decisions. For beginners, this type of trading can be attractive with proper analysis.
• “Buy and Hold” (HODL) is a passive investment strategy where investors buy assets and hold them for a long time, ignoring market fluctuations. This strategy is often used in long-term investment portfolios, based on fundamental analysis and does not require constant portfolio monitoring.