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The question of long-term vs. short term trading is certainly an important one in online currency trading, not least because a long term strategy will always be less costly in terms of the spread and the broker’s commission. If it is true that a long term strategy is more beneficial and advantageous, it is natural that the advantage will be even stronger due to the lessened amount of commissions and fees that must be paid to the broker. Let’s, then, compare these two approaches briefly in this text with the hope of understanding and isolating the most salient strengths of each approach.

Long term and short-term trading follow the same technical formations

First of all, long and short term configurations are essentially self-similar due to the fractal nature of the market action, long identified by scientists Like Benoit Mandelbrot. As such, technical strategies are equally effective (or ineffective) over the longer term, as they are over the shorter period. As a result, there’s no obvious advantage to trading the market over the short term with technical tools.

Long term trading requires discipline

Traders must learn to be disciplined, and avoid impulsive decisions. Long term trading teaches us how to be patient, how to plan, and how to vacillate against market rumors and the claims of less than knowledgeable persons who happen to have an opinion on everything. As a result, it is a great advantage, if only from the educational point of view, to get used to long term trading, if only on a temporary basis.

The shorter the time frame, the harder it is to analyze the market

The longer the period of a trade gets, the greater the role of fundamentals, and the easier it is to analyze and understand and interpret market events in light of economic realities. there are periods of long distortions, without a doubt, but they are not necessarily common. In the short term, fundamentals have little use, so one has to depend exclusively on technical analysis, with its well known shortcomings than imperiling the success of the trader’s decisions.

It is easier to learn in short-term trading

On the other hand, if you just want to test a technical method, it’s probably a better idea to do so on a short-term chart. Due to the fractal nature of charts, if something works there, it’s likely to work on the longer term as well.

Education is a process

Forex education is the most important asset of a beginner. By investing in this asset, he will greatly improve his odds, and will have chance to succeed in trading when others who neglect education fail. Even if we consider the subject from this angle alone, long-term trading is important because it allows us to concentrate on fewer, more important positions and instead focus on understanding what’s going on in the market, rather than worrying about the future of a myriad positions created every week, Each approach has its advantages, but we believe that longer term trading, on the whole, is the better approach.

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