Home > Beginner education > how to identify your trading style

how to identify your trading style

One of the biggest misconceptions about trading is believing you can trade every market condition consistently. Traders who make money specialize. To take it one step further, they specialize in a style of trading that suits their personality. You only need one technique or signal to make a living; you don’t need all of them.

Trading styles: which describes you? If you want to keep your losses close to the vest and small, this means your profits will also be small. Your trades would normally have a 1-1 risk reward ratio, you will make many trades intra day. You would be a scalper / momentum trader.

If you would prefer not to make many small trades but would rather have a longer term intra day focus, you are a position trader. Scalping: Main focus is small losses and small profits, get ideas from reading the tape. Position trader: Focus is longer term, from one hour to one month. Get your ideas from price charts.

Which style of trading best matches your personality to run your trading business? If you choose a style that you are not comfortable with, you will be fighting the trading signals all day.

Spend some time reviewing your trading day. Do you like to make many quick decisions or do you like to put the pieces of the whole market puzzle together before you make a trade. I can tell you from experience, if you try to implement both trading styles, you will master none. You will mix styles in the middle of a trade.

Be definite as to your style and your “ideas” will be much more decisive. Until next time, have a great trading week. http://keystonetradinggroup.com/

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