Trade Smart: How to Choose a Strategy That Works for You

If you have been trading for a while, you have probably heard the saying “every trader should have their own strategy.” And that’s more than just a catchy phrase or some type of cliché. A strategy is not a theory but a decision-making system. Without it, trading ends up being pure gambling.

In this article, we shall explore:

• different types of strategies
• how to navigate them
• how to find an approach that truly fits you, without blindly following someone else’s methods and losing money.

So, what exactly is a trading strategy?

It’s your personal rulebook with clear instructions on when to enter a trade, when to exit, how to manage risk, and which signals matter.

A solid strategy has clearly defined parameters, such as a timeframe, entry points, stop-loss and take-profit levels, maximum risk per trade, etc.

Keep in mind that a strategy isn’t some magical money-making button. It should be treated as a tool that helps you act consistently in any market environment.

The most popular types of strategies

Here are several types that traders typically opt for:

• Trend-following strategies. These imply trading in the direction of the market (buy on the rise, sell on the decline).
• Counter-trend strategies. These ones are the opposite: you enter against the market (buy near reversals).
• Flat-following strategies. With these, you trade within a narrow sideways range.
• Breakout strategies. You enter when the price exits the range.
• Scalping. You make multiple quick trades within a day.
• Swing trading. You hold positions for several days or weeks.
• Algorithmic strategies. These are fully automated and require minimal manual involvement on your part.

Each one has its strengths and weaknesses. That’s why simply taking someone else’s strategy and trying to fit it into your routine and trading style hardly ever works.

How to choose a strategy for yourself: 5 simple rules

1. Assess how much time you have on your hands.
   If you can’t keep a close watch on the chart during the day, scalping is not the right fit for you. It’s better to look for higher-timeframe setups and analyze the market in the evenings.
2. Factor in your psychological traits.
   Some traders are fine holding positions for weeks, while others get anxious after 15 minutes. Know your emotional limits. A strategy shouldn’t create constant stress.
3. See which market it performs best in.
   Some strategies work well on stocks but perform poorly in FX. Others behave differently depending on the asset you choose. Don’t expect a single trading approach to work the same way everywhere.
4. Test it like your life depends on it.
   Before starting to trade on a live account, make sure to try the strategy on a demo or in a tester. Ideally, backtest it and study the results: the number of losing trades, overall profitability, and behavior in tough market phases.
5. Adapt it to yourself.
   Even the strongest strategy may fail to deliver if it is misaligned with your habits, lifestyle, or trading personality. The best approach is to fine-tune it with a mentor. This will speed up the path to consistency.

A common mistake beginners make

Many people believe that if this trader’s strategy works, then they can just copy it and call it a day. The problem is, they forget that this trader also has:

• an entirely different deposit
• a different psychological profile
• 10 years of experience

So copying doesn’t really help and may even hurt your deposit. So, with that in mind, it’s better to use the idea as a foundation and tailor it to your own needs.

And what if you don’t know where to start?
You can reach out to mentors or use ready-made solutions as a starting point in your trading journey. Cartel has mentors with years of experience and proven, original strategies for various trading styles. There are also experts who can help you choose the one that’s right for you.

If you need advice, we’ll be happy to help, so don’t hesitate to contact our manager! 

But above all: don’t trade blindly. Developing and testing a strategy isn’t wasted time. It’s an investment in your long-term stability on the market!