Forex Day Trading, Scalping, Swing Trading

Forex day trading, scalping, and swing trading…

To a novice, there is often confusion about the definitions of the various types of forex trading systems and strategies, especially if you’ve heard them mentioned, and haven’t had a chance to find out what they mean.

Here is a glossary of the main types of trading that you may have heard of:

Forex Day Trading

Forex day trading refers to trading where a trade is entered and exited within the one trading day. That is, the position may be held for minutes to hours. Typically, anywhere from the 4 hour or 2 hour down to the 1 or 5 minutely charts are used.

By exiting intraday, that is before 5pm New York time, it means that there are also no rollover fees.

Forex Scalping

What typically happens with this style of trading, is that trading is done over shorter time frames. It is a different strategy to most other forex strategies, but still does require you to analyse the market to ensure that the set up for a trade is present, because you’re wanting to catch a high probability trade.

Advocates of scalp trading say that scalp trading does not have to be your only style of trading. It is a style of trading that can compliment your other trading stratgies.

Forex Swing Trading

Forex swing trading refers to the style of trading that ranges between day trading and trend following (or trend) trading.

That is, with positions held between one and several days. These systems, being of longer duration than day trading typically capture larger moves in the market. With some of these systems, the stop loss size may be bigger than say a day trading system, to allow the currency room to move in order to make these larger moves. And because the forex market may gap over the weekends, some systems require you to exit positions before the weekend, and to re-enter on Monday to avoid any gapping.

The trading is typically done by assessing charts over longer time frames, than when compared with day trading, so these systems may not need as much time in the day to trade them.

Related topics:

Forex Time Frames


All trading involves a high risk of financial loss, and the information on this site is for general information purposes only and is not financial advice in any form. See your own financial advice before taking any action.

All forms of trading involves risk of financial loss.

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