TYPES OF TRADING STYLES

When you are new to the share market you will come across many trading styles. Today I will be giving you an overview of all the types of trading styles which you are likely to come across while trading in the stock market. Basically, what separates each trading style is the length or period of time you want to be in the trade, the timing of your entry and in other cases frequency of the trades.

Following are the types of trading styles

  • EOD
  • FUNDAMENTAL
  • INTRADAY TRADING
  • NEWS TRADING
  • POSITION TRADING
  • SCALPING
  • SWING
  • TECHNICAL
  • TREND

Now we will look at each of them. You need to make sure what type of trading suits you best and go for it accordingly.

EOD

It means End of the Day, for anyone who works full time, this is a popular type of trading. They analyze the market on the daily or weekly basis and they will set the pending orders to capture price moves as they evolve Keep in mind that they won’t be watching the screens when orders trigger.

If live a busy lifestyle then this is a very suitable method for you needs less time in front of the screen to analyze or to manage the trade.

Fundamental

With the help of fundamental information and financial models, you assess the strength of weakness of stock, currency to anticipate future value, These are also affected by company’s internal news as well as other macro information

Intraday trading

This type of trading opens and closes within the same day, this type of trading has more emphasis on the technicals than the fundamentals

News trading

These types of traders tend to trade around or during the important news release. Extreme volatility occurs when a surprise figure is released which is not anticipated by the market, which basically creates to make a huge profit within a short period of time.

Position trading

Traders which invest in shares for long terms like weeks or months. They are not bothered by the short term fluctuation as they believe long-term investment horizons will smooth these out. these types of traders use more fundamentals however sometimes they can be purely technical

Scalping

It’s a form of intraday trading, unlike others you need to stay constantly on the screen It has a higher potential of profit but also it is a hard type to master as it needs lots of discipline from the trader. It attracts more interest rates for newer traders

Swing

As a swing trader, trader tries to trade the swing of the chart and hope to catch a big move. very popular time frames enter and hold the position on the daily chart for days or sometimes weeks However one-hour charts are also very popular

Technical

You analyze enter and exit the trade system using the technical analysis. This can be performed on any time frame. You can use this in any other type of trading but it is very popular amongst the intraday time frames.

Trend

The main goal behind this type of trading is to identify the trend and only trade in the same direction of the trend. Mostly trend traders used to be associated with the long term traders, But if you want you can be a trend trader in any time frame as all time frame has their own trends.

You need to consider what type of trading will be suitable for you, It is also important to mention what type of profit are you seeking, Are you interested in quick profit or do you want to make a profit over time. Make sure that you also do the risk assessment for each type of trade before choosing any.