Should I trade long term or short term in the forex market?

[tradewithferl]

There are all kinds of school of thoughts out there when it comes to the very old “long term versus short term trading” debate. Of course each side thinks they have the holy grail of answer, and that the other side is made up of delusional losing traders.

In this article we’ll go over the perks each style presents, and give you a straight forward conclusion to the problem.

The pros and cons of long term trading

Long term trading is amazing for beginners and experienced traders alike. The main pro is that long term trading is a lot smoother. You can spot long term trends in one quick look at a chart, enter it and ride it for many days. It doesn’t require huge skills to spot the trends, and usually if the trend is long term it should be fairly safe to enter.

Of course, long term trading is also fairly boring (which is why beginners often stray away from it). You have to wait for that long term trade entry, which could take several days, or weeks!

The pros and cons of short term trading

First of all, short term trading is extremely fun. You get into lots of trades, can make really big bucks with small investments, and it’s great adrenaline rushes. The goal is obviously to get a quick entry, for a small pip risk and hopefully ride the trade as long as you can. One can go 30:1 on these small trades, who wouldn’t want that?

On the opposite side of that, short term trading can be quite scary, and very costly. Beginners shouldn’t try to get into it too soon, as losses can pile up very quickly and capital can run out faster than you think.

Conclusion

There are, of course, pros and cons to each side. Our advice? Mix up the two! Try to build one long term strategy and one short term strategy. The long term strategy will bring you steady money, while the short term strategy will get you the quick (and exciting) money.

Good luck!

 

[Dean M. Bell]

Thanks for your detailed analysis of long term and short term FOREX trading. I think, there should be at least 30% for long term and rest for short term so that you can get most of it and would have liquid money for investing if any sudden opportunity comes along the way.

 

[tradewithferl]

It's just a point of view... to me everything starts with a plan, if you have planned it so just follow your plan

 

[mcrlogitech]

I think that the maximum number of traders who became successful in the financial markets opted for the long term trading. In case of Short Term trading the number of traders loosing are more than the number of traders which are successful.

 

[arigoldman]

It depends, if you see an opening go for it and stay as long as it's profitable.

 

[forker]

Trade both

 

[tomorton]

Trade both

This is the right balance. I trade forex medium term, 2-10 days, and now my days during the London trading session are my own I've got no excuse not to do some intra-day stuff.

But I'm also looking at very long-term forex ideas - exceptionally extended trends are a feature of forex, so 3 time-frames might soon hopefully be my norm.

 

[mcrlogitech]

Trading long term is far less riskier than trading Short term....However it depends on type of traders.....

 

[SmartGeek]

I believe that the more the risk the more the rewards. Forex Trading is a very risky business no doubt, but it is also the most rewarding one.

 

[Dinos]

Day Trading only for me, 5 minute PA only, average 4 -5 trades a day in a 4 hours trading session, I don't look at anything above the 5 minutes chart, trading what I see not what I think. I trade FX, Index and Brent Crude.

 

[Alexander1]

Long-term it seems more safer and more reliable. Less risk for you.

 

[tomorton]

I sometimes think of the daytrading v's long-term trading debate in terms of weather forecasting.

Short-term sounds easier of course. But as a daytrader you're going to have to predict that the temperature within the next few minutes will go from x.xxxx degrees centigrade to x.yyxx. x.zzzz isn't accurate enough. And also that temperature will not go the other way, past say y.xxxx. You have to have comparable accuracy in every trade, and you've got a few minutes if you're lucky to work it out.

As a long-term trend-following forex trader, I just need to take a view whether its going to get colder some time in the next month than it has been.

 

[eddy16]

Long term or short term depends upon the strategy, experience, risk management and amount to trade.

Short term trading is beneficial to traders who have well built successful trade strategies. The benefit is that you can make profits very quickly and can free your capital in risky situations as and when required. Styles of short term trading are- scalping, day trading, swing trading.

Long term trading requires lot of knowledge and understanding about the working of the market. And to make profits in long term you need to have patience. They need to built their strategies based on both fundamental and technical analysis. Long term strategies are- trend following, carry trades.

On whole, long term trading is suitable to those who are willing to invest their time & energy. And for short term traders they need to be very picky about the trades they take due to risk involved.

 

[SmartGeek]

You need to decide that yourself, it depends on you that how you will trade, long term or short term. If you are confident enough, you could go for a long term else stay short term.

 

[ph_trader]

just go with what ever you know right now, gradually you will reach a point when you understand you should never let other decide for you, thats your best option really and best of luck

 

[SmartGeek]

Yeah that is one way and you may wait and gather some more income and than invest, that's the other way.

 

[progix]

I guess first we need to earn money from our primary job and save it, then invest it to different avenues in order to get some passive income streams.

 

[Pat494]

It often comes down to how much time you have to sit in front of the computer and how impatient you are. These 2 factors have to blend. There is little fun in watching the 4 hour charts for many hours on end. But at the end of a working day one can look in on the 4 hour charts to see how they are doing. Suit yourself. Both can work or fail.

 

[NVP]

comes down to your access to screentime and lifestyle............but if you want to make a decent living you have to get low timeframes and put the hours in ..........you need to turnover a lot of trades a week to make good money ........

 

[RoiFX]

Long term trading is best for forex traders. You need patience for trading for long term. In long term, you can gain more with one trade. For short term, you need to monitor your trade regularly. But long term traders don't need regular monitor and it can be less risk for traders