Choosing your main Forex trading strategy and trading range

Defining your plan on how you will trade your account is important. You should have most of your ideas and blueprint mapped out before you begin your trading sessions to avoid emotions coming into play.

The main Forex trading strategies consist of:

  • Swing trading
  • Day trading
  • Scalp trading
  • News/Fundamental trading

Each Forex trading strategy has its own characteristics that will not suit all Forex traders. For starters, each Forex trading technique has a time component, and short-term methods won’t work if you can’t be behind the screens for large periods of the day. Profitable approaches and styles must be adapted to your plan and how you envision it working.

We all have different styles, and how we behave outside of the trading room reflects on our Forex trading performance. This is due to the fact that we are all human beings with feelings. It will be more difficult to succeed in Forex trading if we are emotionally involved.

The simplest way to overcome this is to trade with quantities that will not affect you if you lose. Then we can concentrate on improving ourselves and expanding our skill sets by using our Forex trading techniques.

Continually striving to improve your Forex trading strategy, regardless of your situation, will benefit the Forex trading strategy you develop over time. Not all Forex traders fit into a box and we are all different.

What Forex trading strategy is best for me?

What Forex trading strategies would perform best for you will be determined by how much time you have to devote to your work. If you have other life priorities such as a job, then swing or position trading might be the best approach. If you have a lot more time to devote to your craft, you could consider trying day trading to see if it fits your investment personality and character.

Forex traders should test new techniques on a demo account and start small. Always strive to obtain the right to trade Forex for a larger sum of money. You can test the waters by starting small and seeing how well you can build a solid performance across a large number of trades.

Useful Forex trading strategy books

In previous blog posts, we have displayed some of our books that we recommend traders read. Here are a few that will help with your Forex trading strategy:

  • Market Wizards by Jack Schwager.
  • Reminiscences of a stock operator by Edwin Lefevre.
  • Trading in the zone by Mark Douglas.

These books cover a wide range of technical Forex trading strategies, including how to trade and when to trade. While you may encounter other Forex traders online that claim to be profitable based on a small sample size, don’t be fooled into trying to make quick money or trade too aggressively by overleveraging your account. When you’ve discovered or established your Forex trading strategy, you’ll know since it will make your life easier and more sustainable.

Most popular prop trading strategies

As we have analysed hundreds of prop trading strategies of the past year, we have understood similar habits across different trading styles and trading strategies. Across all trades, all profitable Forex traders will have positive risk-to-reward ratios. The best performing Forex traders seem to be all-round traders, with trades lasting from as little as 30 minutes up to 3 days. Some have also leveraged high-impact news to push their accounts toward profit goals. The beauty of our prop fund is that we welcome new Forex traders with open arms and are always on the lookout for new varieties and styles of traders that come through our fund.

After speaking with a few Forex traders recently, they discussed the 80-20 rule, which states that they devote 80% of their time to technical analysis and 20% to fundamental developments. This combination appears to be particularly effective in forming long-term successful behaviours. We’ve examined volume drives before, and if a trade has a multitude of confluences in one place, the news can assist drive momentum there.

Back test some of the methods you think would work for your lifestyle by doing some research and figuring out your accessible trading times. Then, after it’s working, progressively deploy it on your live account with minimal risk.


FTUK Funded Account Disclaimer

CFTC Rule 4.41 – Hypothetical or Simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, because the trades have not actually been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs, in general, are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown.

All our funded accounts come with a fixed equity stop out level. Once the account equity level gets below this fixed stop out bar, we will close all running trades and disable trading and access. The stop out level is a fixed value for each funding level, this means that any profit which has been made by the trader increases the loss allowance.

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