Last update 2020.08.05
In the forex market, following the tradition of the stock market, traders buying in a rising market (long position) are associated with bulls. Conversely, traders selling into a falling market (short position) are associated with bears. So, what is your favorite forex style: bullish or bearish?
Trade direction is only part of any professional’s trading psychology and is often use it to maximize results. Both bullish and bearish strategies can be viable forms of investment, depending on the trading objectives, with advantages and characteristics that can fit different personalities.
Understanding these positions is important when creating a diversified investment portfolio.
Long-term investing means that you perform trades that usually take months or years, while short-term trades can take place on a trading day, with trades that last from a few minutes to a few hours. In the case of long-term trading, your orders are kept from days to weeks.
These time-horizons are ideal for different investment goals, trading skills and personal financial traits.
Bulls make money
Long-term investing requires a psychology of buying and holding. In such cases, long term investors are less demanding and stressful because they do not have to worry about day-to-day volatility but focus only on the future price.
However, not everything is fun; these types of trades can also result in unrealized losses while waiting for the future date to arrive, depending on your time-horizon. Having deep knowledge of the underlying market including fundamental and technical indicators with forex is key for long-term investing.
Trading in this way also means that you invest more money in fewer trades, can reduce risk and focus more on longer-term benefits.
Bears make money
In the case of choosing a short-term forex trading style, you will have more opportunities to analyze that up your time, including tracking data, analysis, graphs and reading market news. These factors can affect forex market prices, including the sudden drops which is how bears make money, by selling into a falling market.
In addition, being aware of spreads is also important, as we are dealing with a decrease in the market price, so the trading costs matter too.
Emotional discipline in forex trading is a key point to negotiate because it makes you more focused and rational. Following a strategic strategy involves conducting the opening and exit of a trading position. In other words, it is not enough to know when to enter the market, you must have an exit plan too.
Above all, emotions often cause traders to deviate from their trading system plan is one of the principal reasons why traders lose money. How to lose is part of the game, and even good trading systems end up having bad times. The key is to keep your average losses smaller than your average gains.
An example to make you understand
If you believe that some forex pair has a potential room to rise, such as the symbol GBP/USD after Brexit started on Friday (01/31/2020), you would consider a long (bullish) position. A long position would benefit from a rise higher in the price of the GBP/USD, while a move down in price would produce a loss for a trader that bought the pair.
During the time that you have a long position in the market, you can also use some short position to protect your investment in turbulent movements. It can generate complementary gains in a short time, even if it is of lesser quantity. This offsetting trade is known as a hedge trade or partial-hedge trade.
Therefore, you can take a long position to make a profit in a broad market movement and use small short positions to gain when your long trade loses.
A strategy that works at both moments in forex trading
Here at Wiseinvest.ai, we help you with both long and short strategies and you do not have to spend all day looking at the charts, because our AI already does it for you. We help remove emotional bias and work without interruption 24 hours a day, five days a week.
For instance, our AI trading system can invest automated in your broker account. You also have the option of AI signals by which in can use to trade in any forex brokerage. In both cases, the average annual return of 38.21%, for four consecutive years. Our strategies evolve with information going back almost 14 years.
We also do your position size calculations to minimize the risk of your investment, no matter if it is short or long.
Artificial intelligence supporting bulls and bears in forex
If you want to start investing in forex as a professional, but do not have time to do all the training, you can subscribe to Wiseinvest financial content and use the AI to trade automated or receive Wise forex signals to copy and paste into your forex brokerage account.
Artificial intelligence does not suffer from mood swings, so it is more reliable than humans are. We also have a professional team of forex economists, engineers and traders to improve our strategies over time.
The best way to trade forex with AI
Whether you are a beginner or a professional, you can improve your forex trading performance with our AI in simple steps. Check it out below:
Don’t you have a broker account yet? Our AI is integrated to trade automated with the broker Oanda. Click here to open an account.
- Long positions focus on ascending markets, known as a bull market.
- Short positions focus on descending markets, known as a bear market.
- No matter what your preference is, you probably will use both bullish and bearish strategies to maximize your returns.
- Wiseinvest AI forex trading system and financial content of Wiseinvest are useful to both kinds of traders.
The best professionals in forex market use the best tools to improve their performance. And You can have the same features and use the A.I. power of Wise-Signals to help you be more successful.
Finally, what is your favorite forex style: Bull or Bear? Did you manage to think about it with the help of Wiseinvest?
Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.
The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. The forex broker Fxcm warns that 69.66% of retail forex traders lose money trading CFDs.
The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.