DAY 39: Understand your own personality and choose your trading style

On DAY 38, we focused on how to handle winning streaks and losing streaks, learning about mental balance and concrete countermeasures.How to handle winning and losing streaksToday, as DAY 39, we will delve deeper into the mental aspect with the theme of
“Understand your own personality and choose your trading style”.
Trading styles vary fromshort-term scalpingtoswing trading,day trading, etc., but knowing not only the market but also your ownself is the key to choosing a style. Forcing a method that doesn’t fit your personality will accumulate mental stress and make it harder to win consistently. This time, let’s explore the points to identify a style that suits you.

1. Why do personality and style matter?

1. Mental stability directly impacts results

2. A method that doesn’t match your personality increases stress

   • Example: a calm person trading a 1-minute scalping time frame can become mentally fatigued.The mind tends to tire

3. The amount of time you can monitor the market and your lifestyle also matter

2. Characteristics of each style and personality compatibility

(1) Scalping (ultra-short term)

• Characteristics
  • Trades are completed in seconds to minutes; sometimes dozens of trades in a day.
  • Small price moves are accumulated steadily, but the costs from spreads and high-frequency trading can be significant.
• Compatible personalities
  • Likes chasing fine price movements, has quick judgment and reflexes, and can’t wait easily.
  • Has high concentration and enjoys fast-paced tradingpeople.
• Caution
  • Not so much that it doesn’t suit you, but if you tend to be easily impatient or irritable, you may see more losses.
  • If the environment (fast internet, low spreads) isn’t prepared, you are at a disadvantage.

(2) Day trading (short-term)

• Characteristics
  • Positions are settled in minutes to hours, generally not held overnight.
  • Targets intraday price movements with a moderate turnover rate.
• Compatible personalities
  • Can secure a consistent daily time to look at charts,has time during the day to view charts.
• Caution
  • Many currency pairs move significantly in the evening to night, so whether you can view during the open of the European and US markets is crucial.
  • Because you settle daily, you must account for some noise and spreads.

(3) Swing trading (mid-term)

• Characteristics
  • Keep positions for a few days to a few weeks, aiming for larger moves.
  • Stop loss tends to be wider, but profit targets are larger too.
• Compatible personalities
  • Struggles with watching the screen steadily; a patient, deliberate type.
  • Even if busy during the day, morning/evening checks are enough to manage it.
• Caution

(4) Long-term investment (position trading)

• Characteristics
  • Held for months to years, closer to asset management than FX trading.
  • Includes swap strategies that exploit interest rate differentials.
• Compatible personalities
  • People who don’t worry about short-term moves and want to operate with a long-term economic trend in mind.
• Caution
  • Significant policy changes or financial crises can cause unrealized losses to grow.
  • Because it’s long-term, capital can be tied up for a long time, risking missed opportunities.

3. How to objectively understand your own personality

1. Record & analyze in a trading journal

2. Reflect on handling losing/winning streaks

3. Compatibility with your life rhythm

4. Risks of continuing with an unsuitable style

1. Increased fatigue and irritability
   • If scalping isn’t suitable and you force it, your mind can wear down and judgment can falter.
2. Worsening losses from repeated defeats or mental breakdown
3. Ultimately, larger losses or trading abandonment

5. Approaches when trying to change your style

1. Make gradual transitions

2. Revisit backtesting & demo trading

3. Mental acclimation

6. Summary & next week preview

Summary

1. Trading style is deeply related to personality and lifestyle: Misjudging this can increase stress and make mental state unstable.
2. Representative styles: Scalping (ultra-short-term) / Day trading (short-term) / Swing (mid-term) / Long-term investment (position trading)
3. Objectively view your own personality: Use a trading journal, reactions to losing/winning streaks, and lifestyle rhythms for clues.
4. Pushing a mismatched style can lead to breakdowns: Fatigue, rule-breaking, and eventual large losses or loss of motivation.
5. If changing your style: Start with small steps, verify and acclimate gradually, and move without forcing it.

Next time (DAY 40) theme: Mental training – Building habits outside trading

• Starting tomorrow, we will focus on lifestyle habits outside trading during Mental Strength Month.
• Exercise, sleep, diet, meditation, etc., elements that may seem unrelated to trading actually contribute greatly to mental stability and performance.
• Not only mental state during trading but also outside-life habits are the hidden secrets that influence win/loss, so please look forward to it!

If you’re interested in automated trading, please also check the link below.
https://www.gogojungle.co.jp/users/147322/products

If this was helpful, I would be grateful if you could click “Read more.”
Thank you.