Position Trading
Strategies
What it means
A style where you hold trades for weeks to months, riding long-term trends. It requires patience and small position sizes to weather large counter-moves.
Example
A position trader buys gold at $1,800 in January, expects a multi-month up trend, sets a wide stop at $1,700 and a target at $2,100, and exits in July when the target hits -- a 6-month trade.
Mistake beginners make
Beginners set tight stops on position trades and get stopped out by normal multi-week noise. Long-term trades need wide stops and small sizes, or you will never survive to the target.
Related terms
- Swing Trading — A style where you hold trades for days to weeks, aiming to capture medium price swings. Le…
- Trend Following — A strategy that buys assets already in up trends and shorts those in down trends, holding …