What Type of Trader Are You? πŸ€”

OANDA:XAUUSD   Gold Spot / U.S. Dollar

Hey traders,

In this post, I decided to make a comparative analysis of three main trading styles: scalping, day trading, and swing trading.
We will go throw the main pros and cons of each approach and discuss common misconceptions.

πŸƒβ€β™€οΈπŸƒ Let's start with scalping.
I guess many of us were impressed by videos on youtube showing how a guy makes thousands of dollars applying a simple scalping strategy.
Some of these videos get millions of views and excitement from the audience. No surprise the majority of newbies start their trading journey with scalping strategies.
Practicing some of them and trading on a real account, these traders suddenly realize that the youtube videos barely reflect the reality of scalping.

Scalping requires being extremely reactive, making trading decisions quickly, and constantly staying focused.
Moreover, it turns out that this trading style is extremely risky, and occasional losing streaks become an essential part of the process.
A pro scalper usually opens dozens of trading positions per day and manages many of them simultaneously.
Even though it is a fact that a solid scalping strategy is a true cash machine, the constant pressure and high level of stress make many traders leave that game blowing their trading account.
A true scalper is a guy with iron nerves and a sharp mind.
It takes many many years to become a person like that.

πŸšΆβ€β™€οΈπŸšΆIntraday trading is a bit simpler. While quite often scalping gives a trader just a couple of minutes to react and make a trading decision, intraday trading gives the hours. Such a trading style is slower, the intraday perspective is not that chaotic and irrational. It takes many hours for the trading setup to play out making the trade management process not that time-consuming. Moreover, intraday trader tends to open much fewer trading positions than a scalper. Analyzing primarily 4h/1h time frames less trading setups meet the entry conditions.
That primarily affects the potential gains though. Lesser you trade, the less money you make.
I consider myself to be an intraday trader. Trading full-time of course I was trying different scalping strategies, but I must admit that I can’t make the decisions that quickly, I can’t constantly hold so many active trading positions in my mind, I need some time to think, I need some time to do other things, I want more freedom. For that reason, intraday trading is my choice.
And let me be frank right here: I am not trying to say that intraday trading is simple, it is SIMPLER than scalping still remaining extremely complicated to master.

πŸ•΄πŸ•΄ If you want trading to become your side income if you have a full-time job and just a couple of hours per day for charting, I believe that intraday trading/scalping are not appropriate for you. In your situation, I would consider swing trading.
Swing trading is extremely slow. Being primarily focused on weekly/daily time frames a swing trader tends to hold trading positions for weeks, sometimes even months.
Moreover, it takes many days for a swing trading setup to form and the market gives a trader much time for reflection.
Of course, that primarily affects the potential gains:
I believe that among the 3 trading styles that we discussed, swing trading generates the lowest returns.

Swing trader is the best starter for newbie traders.
Analyzing higher time frames they can constantly follow the market and don’t miss the major moves.
Just 1-2 hours per day are enough to follow dozens of financial instruments.
Only by becoming a consistently profitable swing trader, one can try himself in intraday trading.

Working with hundreds of struggling traders from different parts of the world I realized that the majority has the inverted perception of scalping/intraday/swing trading. I hope that this article will shed a light on that topic.

What trading style do you prefer?

❀️Please, support this idea with like and comment!❀️
Comment: Check my new idea on BTCUSD: