Quotex is an extremely dynamic, complex market in which currency traders are constantly trying to take advantage of the changing exchange rates. Although beginners should learn the basics first, more advanced traders use complex strategies to increase their chances of success. We will examine some of the most advanced Forex trading strategies that are used by professional Quotex traders. Click here.
1. Swing Trading
Swing Trading involves holding positions over a period of days or weeks and capturing short-term to medium term price changes. The traders use fundamental and technical analysis to find potential entry points and exits. The strategy is one that demands patience and discipline, as its goal is to take advantage of larger price movements.
2. Day Trading
The day trading process involves the opening and closing of positions on the same trading date. Day traders use technical analysis to quickly make trading decisions. The aim is to make money from the price movement of short duration.
A high-frequency strategy, Scalping involves traders who aim to capitalize on small changes in price within minutes. Scalpers are able to make many trades during the course of a day and profit from small fluctuations in price. This strategy requires an in-depth understanding of market analysis, as well as access to live data.
4. Carry out Trade
Carry trading involves borrowing in a foreign currency that offers a low interest rate then investing in another with a high rate. Investors are looking to gain from the difference in interest rates, while taking into account potential price depreciation or appreciation. It can provide a steady income. However, it is risky when exchange rates go against the trader.
5. Breakout Trading
Breakout traders are interested in instances when the price of an exchange rate pair breaches a major support level or resistance. The goal is to profit from the momentum that these breakouts generate. In order to minimize risk, many traders use stop-loss or take-profit orders.
6. Automated Trading
EAs are used to automate trading by experienced traders. EAs follow a specific trading strategy and operate without human interaction 24/7. The traders can now take advantage of the trading opportunities available to them around the clock.
The strategy of hedging allows traders to manage their risk by using several positions. As an example, the trader could hold a position long in one currency pair and simultaneously a position short in another currency pair. In this way, the loss of one trade is offset by the gain in another.
8. Algorithmic trading
The use of computer algorithms for algorithmic trading is to automate trades according to predefined criteria. The algorithms used to execute the trades can process large volumes of data at high speed. Institutional traders and hedge fund use algorithmic trading.
How to Manage Risk Effectively
It doesn’t matter which trading strategy is chosen, managing risk will always be important. To reduce potential losses, traders need to determine their risk appetite, create stop-loss instructions, and diversify the portfolio.
Quotex Forex constantly evolves, so advanced traders should stay abreast of market trends, economic indicators and world events that could impact the currency exchange rate.