Should I trade Forex everyday ? This is a question often asked by beginners in Forex trading but the truth is even advanced traders don’t know the answer to this question because there’s no one right answer for it.
The reason we have more than one answer to the question if one should trade Forex everyday is that first it primarily depends on the trader’s level of experience and second on his preferences, so there is not limited ways of trading Forex, therefore there can’t be one right way of doing it, however, there’s preferred ways that shown success in the past, a few almost all traders follow.
The first way of trading Forex is Trend Following, which might be the easiest way of trading because it has one rule; follow the trend. Following this way of trading means that you buy low, and thus guaranteeing a good price for your financial instrument, and you sell high, and thus a good return on your investment. The trend follower doesn’t trade so much, he actually trades only every few days, in the same direction of the trend.
The second way of trading Forex is Scalping, which might be the preferred way to a lot of traders, unfortunately, to be a scalper, you have to have a success ratio of 70% and above, otherwise, your scalping strategy is going to hurt the trading account.
The scalper has to trade Forex everyday to make it beneficial to him, other wise, the returns are so low it’s not worth it. The trader has to be very strict with his stop loss, in order for his winning positions to cover his losing ones, and make a reasonable profit.
The third way of trading Forex is event trading. Following events and economic releases is important for all kinds of trading, but trading this way and this way only means trading economic releases that are expected to have a big enough impact on the market and allows to take a position a bit before the release and close it a few minutes after the release.
One important aspect of event trading is that the probability for a losing position is high, and so the success rate is low compared to other ways, simply because they depend on events, which are highly unpredictable. Therefore, using this way of trading involves high volume trading to achieve the profit target on the price movement during news periods. Event trading requires trading Forex everyday, or days with important news.
The forth way of trading Forex is long term positions, which usually characterized by far targets which might take months or a year to achieve. They usually mean that position are cluttered around significant tops and bottoms. This method involves using other analytical tools and technical indicators.
Now no matter which type of trading you follow, the number of trading days relate directly to the trading plan, which one should make sure he follows it, otherwise the trader has to reevaluate his trading methods and try trading another way that suits him better, usually change is good in this sense.