The forex long term trading strategy benefit
The predictability is the main benefit of long term trading strategy. In the long term strategy the market prices are determined by fundamental factors includes unemployment, interest rate, productivity and many others. The analyst then get the conclusions for the future prices by examine the entire factors and place to the longer term framework. All traders that desire to acquire the causality sense then create the logical basic for the decisions for trade. The other benefits for long term strategy are;
- Lower cost. The long term trader does not need and should not open and close their trade position too often, with the result from the fees owed to the broker, there are a lot of less than what incurred un the course of short term trading. The spread cost in long term strategy is variable in trader, the cost are constant while the profit and loses are varies. Adopting the forex long term trading strategy approach can minimize the invisibility respect and get better plan in next trade.
- Fundamental analysis
- Ease of mind and confidence. Keep in your mind that when you use long term approach, you are able to relax afterwards after the long preparation in trade. This because the trader are not need to keep the trade track with every single daily events in the market especially when it comes to the price action.
The forex long term trading strategy disadvantage
By use long term strategy it bear a lot more of productivity and convenient to analyzing the economic event a day after the trading closing. This can reach the trader with the rational conclusion that will prevent the emotional pressure. It is different from short term strategy that exhausted with heavy action on the day. However, the best system even gets weakness too. Long term trading exposes the trader to get longer term movements that offer large and greater risk that means if you get wrong side decisions, it can means much more painful loses. To reduce the risk, the trader can reduce the leverage, and keeping the humility degree in the market auction. It is important for the forex long term trading strategy trader to use layered entry approach and consistent into their size trade for loses will not wipe out the gains from the monthly past.