When it comes to long term trading, there is no strategy that is more fitting than position trading in the forex Australia market. In fact, position trading is the most well-known long term forex trading style. While it is usually employed by big institutions, fund managers and high worth individuals, this does not mean that a retail trader cannot use it if it appeals to him.
For instance, you could be an individual with significant financial means who already has a business or a job but is still interested in boosting his funds. If this is indeed the case then you would be interested in knowing more about what it means to use position trading strategies in the forex Australia market.
Trades Can Remain Open For Multiple Months
If your chosen strategies fall under the category of position trading then you should know that your trades can end up being open for a number of months at a go. While the maximum time period that your trades will be open for can run into months, the shortest period would be a couple of days. However, you should know that it is quite rare for position traders to close their positions in the forex Australia market within two days.
Position Trading Is All About Long Term Trends
As you have no doubt already surmised that positions are open for a long duration in position trading, this method of trading in the forex Australia market would see you focus solely on long term trends. This means that you will be using forex charts based on time periods like four hours, daily, and even weekly to analyse the market.
Potential For Profits And Risks Are Both Very High
In position trading, the potential for profits and risks are both extremely high. This means that if you incur losses then they will be big and if you manage wins then they would bring big returns in the forex Australia market.
Position Trading Is The Least Time Intensive Trading Method
Extremely short term trading styles are the most time intensive in the forex Australia market. Position trading is the most typical long term trading style which means that it is the least time intensive. This makes position trading ideal for those individuals who are only interested in forex trading on a part time basis.
Transaction Costs Are Low And Market Noise Irrelevant
One of the biggest benefits you will enjoy by choosing position trading is that your transaction costs will be very low because the trades you make in the forex Australia market will be very few.
In addition to this, you will also be free of all considerations relating to market noise, which can be defined as random price movements. Because you will target long term trends, short term fluctuations will become irrelevant.