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Best FOREX Trading Strategies in 2023



FOREX Trading Strategies

In trading the FOREX market, a trader must use a set of strategies to get ahead of the game and avoid further losses. Following is a list of the basic strategy used by most of the traders to make more profit in FOREX trading.


Two basic forms of FOREX Trading Strategies in 2023:

1. Long Trade- Traders bet that the price of a currency pair will increase in the future,and they will profit from it.

2. Short trading - the opposite of long trading. It is a bet that the price of a currency pair will fall in the future.


Four basic types FOREX Trading Strategies in 2023:

1. Scalp Trade

In this strategy, you must hold your position as a trader for a short period of time, such as seconds or minutes, and the number of profits you can make is limited in terms of number of times. Percentage in Points (Pips). This trade is considered cumulative in the sense that a small profit made in each individual trade is going to add up to a larger amount at the end of the day or in your preferred time period. Using this strategy, you need to rely on predictability of price movements, but this strategy cannot handle volatility. Therefore, you should limit your trading to the most liquid currency pairs and place your positions during the busiest times of the day to trade.


a) have lots of trading opportunities every day

b) Can earn a healthy income from


a) Higher financial costs (paying for your software, newsfeed, connections, etc.)

b) Staring at screens for several hours a day

c) it's a very stressful endeavor


2. Day Trades

These are short-term trades in which your position is taken and liquidated on the same day. The duration of using a day trading strategy can take hours or at least minutes. If you want to become a day trader, you need to equip yourself with technical analysis skills and knowledge about important technical indicators in order to make profits. In comparison, day trading strategies also rely on gradual gains throughout the day, just like scalp trading.


a) If you are good, you can make money in most months

b) No overnight risk as you close your position by the end of the day


a)  It's stressful because you're constantly watching the markets, you

b) Can lose much more than intended if you encounter massive slippage (from Black Swan events)

c) Huge opportunity cost because you can earn a full-time salary elsewhere


3. Swing Trade

In this strategy, you as a FOREX trader need to hold your position for a period of more than a day or 24 hours. For example, you can limit your trading positions to a few days or weeks. The swing trading strategy is very useful during major announcements by governments or during times of economic turmoil. Since you will have a longer time frame using this strategy, you do not need to monitor the markets throughout the day. As a swing trader, you must have a deep understanding and be always updated on economic and political developments as well as their impact on currency movements, in addition to technical analysis.


a) You don't have to quit your full time job to become a swing trader

b) It is possible to be profitable every year because you have more trading opportunities


a) won't be able to ride the big trends

b) overnight risk


4. Position Trading

Using this strategy, you should hold your position on your chosen currency pair for a much longer period which could last for months or even years. This type of trading strategy requires more fundamental analysis skills as it provides a rational basis for your trading.


a) No need to spend much time trading as your trades are long term

b) Less stress in your trading because you are not worried about short-term price fluctuations

c) A favorable risk to reward (possibly 1 to 5 or more)


a) A strong understanding of the fundamentals that drive the market

b) Requires a large capital base because your stop loss is wide

c) Can't make profit every year due to less number of trades


5. News Trading

Some FOREX traders with deep pockets and a good appetite for risk can use news trading strategies, although they are probably not ideal for FOREX beginners. These strategies can be based on fundamental and technical analysis and they usually benefit from the remarkable volatility seen in the FOREX market shortly after major news releases.

News traders generally need to monitor the economic calendar for major data releases. They then closely watch the market before the event to determine key support and resistance levels so that they can react immediately after the event based on the results. News traders need to maintain strict discipline when managing their currency positions during such fast markets and often place stop-loss and take-profit orders in the market.


An example of an economic calendar and a data release event that a news trader can use is the US unemployment claim. This data was particularly volatile during the COVID-19 shutdown in the US and the FOREX market fluctuated significantly after its release. While those job numbers were disappointing, what mattered most to the market is how the results differ from the market consensus.

In the bottom position, the number of previous unemployment claims was 3,176K, the expected number was 2,500K, and the result was worse than expected at 2,981K. Its release should have put pressure on the US dollar against other currencies.


Other FOREX Trading Strategies:

Some traders are using strategies that are based on broad areas of technical analysis, such as breakouts and moving averages, to test or polish themselves. Business outlook even more so.


What is FOREX trading?

FOREX trading refers to the simultaneous buying and selling of currency pairs such as USD/INR, EUR/INR and others to generate profits or hedge businesses against adverse exchange rate movements.


What is a FOREX trading strategy?

A FOREX trading strategy helps you decide when to buy or sell. It involves studying fundamental (market environment, economic data) and technical (trends, breakouts) factors. Price action trading, position trading and day trading are some of the top FOREX trading strategies.


What are the Best FOREX Brokers for Trading?

eToro,, CedarFX, FBS, AvaTrade, Pepperstone, IG, XM Global, FOREX Capital Markets (FXCM), Interactive Brokers


What are some FOREX trading mistakes?

The most important is the lack of sufficient capital and high leverage with margin. 


Is FOREX trading a Good Career?

FOREX online trading has quickly emerged as an easy way to make money. Truly FOREX trading is a challenge, but so lucrative that novices and experts become addicted. Due to high liquidity, easy accessibility and its 24 x 7 schedule, online trading in FOREX is a promising career path.


Is FOREX trading a gamble?

FOREX is gambling in a trading sense, but it is not the same as betting in a casino, because in FOREX you invest you are not betting.


Why do most FOREX traders fail?

Poor risk management, and even worse, no risk management is a major reason why FOREX traders lose their money quickly. Risk management is the key to survival in FOREX trading including day trading. You can be a good trader and still be wiped out by poor risk management.


How can I make money fast in FOREX trading?

The way to make money fast in FOREX is to understand the power of compounding growth. For example, if you aim for 50% per year in your trading, you can grow an initial $20,000 account to over a million dollars in less than 10 years. Break the norms, get more.


How long does it take to learn FOREX trading?

With some hard work and dedication, it should take you 12 months to learn how to trade FOREX


Is FOREX Easier Than Stocks?

Money markets have a greater reach than stock markets. Traders can trade stocks almost 24 hours a day from Monday to Friday, but it is not particularly easy to access all those markets. FOREX trading, on the other hand, is much easier to do round the clock, Monday to Friday.


Do you pay tax on FOREX?

Four types of taxes are relevant to FOREX traders:

Income Tax - The tax you pay on your total income.

Corporation tax - The tax you pay on your limited company's income.

Capital Gains Tax - The tax you pay on your gains from selling the property.

Stamp Duty Reserve Tax – a tax or duty that you pay when you buy shares


How do I close my FOREX account?

a) Check your trading platform to determine if you have any open trades outstanding. If you are a long term trader, you may have some FOREX trades still open. ,

b) Obtain an account termination form from your FOREX broker. ,

c) Complete the form. ,

d) Submit the form to your broker as requested.


Which bank account is best for FOREX trading?

Standard Bank is recognized as the leading provider of online FOREX trading to investors worldwide. Standard Bank prides itself on competitive pricing, good liquidity and a range of 160+ different FOREX crosses.


Can I trade FOREX without a broker?

Yes, you need to use a FOREX broker to trade FOREX. You will need to open an account and deposit enough collateral (margin) so that you can place orders to your broker to buy or sell FOREX.


Who controls the FOREX market?

It is decentralized in the sense that it is not controlled by a single authority, such as an international agency or government. The major players in the market are governments (usually through their central banks) and commercial banks.


How is money made in FOREX?

One can make money from FOREX trading by correctly predicting the price movements of a currency pair and opening a position for profit. For example, if you believe a pair will decline in value, you can go short and lose profits if the market falls.


Can FOREX Brokers Manipulate the Market?

A common belief about financial markets is that price manipulation is not possible when the market is too liquid. Instead, it is much easier to manipulate an illiquid market. This means that the FOREX market, where $5 trillion worth of currencies are traded every day, is not susceptible to manipulation.


What is an ECN Broker?

An ECN broker is a financial intermediary that uses an electronic communication network (ECN) to provide clients with direct access to other participants in the equity and currency markets.

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