There are many types of trader, find out which one you are, Scalper, Day trader, Swing trader or Position trader, and what it means

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Scalper

Trades the Tick or 1 Minute chart.  Tries to catch quick moves in the market and is usually in and out in of the market in less than an hour, sometimes minutes.  Trades a few times an hour, these guys enjoy lots of action.

Personal Story

I used to love the word scalper.  When I first ventured into the world of Forex trading, in my spare time after work with a few mates, usually at one of our apartments and usually with a bottle of beer, or two or three, all we all wanted to be was scalpers.

Why take 10 trades a month on the Daily chart when we could take 5 trades a day on the 5 minute chart and make more money in a few hours than we would in a month!  Well, actually, within a month not one of our quartet had more than £200 in their account.  We had all started off with a £1,000 account, with our own strategy (some from forums, some from gurus) and, within a month, we had lost over £3,000 between us (quite a lot of money back then).  It was embarrassing to say the least and a story I usually keep to myself even to this day (until now)!

Well, that was many many moons ago, the sad story is that is was not my last attempt at scalping (those other stories I will keep to myself (for now)).  Anyway, its safe to say I no longer consider scalping as a trading approach nor do I recommend it to anyone else trading Forex.  I say this on the basis to this day I have yet to meet a profitable Forex scalper, one who consistently makes a profit year in year out from the markets trading such short time frames.

Nowadays I prefer Swing/Trend trading off the 4 hour charts.  I do still like to Day trade when I get time but I just find that I either dont get time or I end up doing something more interesting than looking at a 15 minute Forex chart for a few hours.  If I do get time I usually take a sneaky look at the reports John sends out as part of his Trading With Confluence Daily Analysis Service  to see if anything is setting up on my intra day charts in line with his views.

Position trading is not for me either as I believe it requires being news savvy which I am not.  Additionally, although I am by no means an action trader, I like trades that run for weeks or maybe a month or two, I am not a fan of position trades which can run for years.

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Day Trader

Trades the 5 15 Minute chart.  Tries to catch the market move of the day and is usually in and out in the same day, sometimes in less than a couple of hours.  Trades a few times a day, these guys enjoy lots of screen time.

Swing Trader (also includes Trend trading)

Trades the 1 Hour or 4 Hour chart.  In and out in a few weeks but some trades can run for months.  Trades a few times a week, these guys are quite relaxed.

Position Trader

Trades the Daily and Weekly charts.  Takes a long term perspective and positions are often left to run for months sometimes years.  Trades a few times a month, these guys also observe the fundamentals.

What Type Of Trader Are You?

If you enjoy lots of action become a Scalper.  If you enjoy lots of screen time then it’s Day trading for you.  For a more relaxed approach try Swing (or Trend) trading  and if you are into fundamentals long term Position trading will be your choice.