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Indeed, every trader has his unique trading style. A trading style depends on trader`s initial money management experience as well as on the value of money in his life and his attitude to money. There are lots of Forex trading strategies, however, it does not mean that market participants are unable to shift their natural preferences and that choosing a trading style as compared to the other styles is not likely to change. Different traders classify trading styles differently. Some define them by markets where they trade or commodities of Forex currency pairs they use in trading. Another category of traders use fundamental and technical division, some classify by spreads or options. One of the preferred classifications is given below:

• Scalping
• Technical method
• Inter-market spread trading
• Arbitrage trading

Scalping

Scalping method involves numerous buying and selling transactions in a trading instrument within the frames of a day with a small portion of profit making up a long term high profit. This method is not based on casual gains. At the same time the probability of losses is subdued as this method proves to be rather safe.

While scalping traders gain profit from small market fluctuations analyzing 1-5 minute intraday charts, their profit per each trade is tiny. Also scalpers do not trade overnight.

Technical method

Technical method is used in trading in all trading instruments. It is aimed at rapid profit attaining. When it comes to stock trading technical traders estimate the history of the company, they analyze the charts, market movements, they oppose different trading models forecasting what may happen in the near future. Technical analysis involves studying of price actions, trading volumes in order to define trading patterns such as Head and shoulders etc. Trading indicators used in technical analysis include moving averages, technical methods study support and resistance levels.

The main disadvantages of technical method are:

• High dependence on the previous movement (history of movement);
• Numerous technical indicators. There is no ideal trading indicator.

Inter-Market Spread Trading

Inter-market spread tradingconsists of a long position on one exchange and a short position in the same or similar financial instrument on another exchange. Many analysts consider inter-market spread trading too complicated. This style is used in trading on commodity and futures exchanges.

Arbitrage trading

Arbitrage trading, also known as risk-free profit, is conducted through simultaneous buying and selling of a financial asset in order to obtain profit from difference in prices. This trading style is used on different exchanges and trading platforms. An investor may take profit from rate fluctuations. For example, a trader buys an equity at a low price and then, when the rate moved up, he sells it at a higher price. Arbitrage often associates with risk, sometimes major, sometimes minion.