If you are a day trader, you are of course not concerned with whether there is something like a ten year up and down trend in a particular currency market. For you the long term is between breakfast and lunch - late afternoon is a distant horizon that doesn't concern you at all. Many day traders do large numbers of trades during a single day, making or losing small amounts of money all the time.
Another type of trader is the so called swing trader. Swing traders do not trade as often as day traders. They wait for a medium term trend in the market, and then either go long or short on a particular currency. They will stay in the trade for as long as the trend lasts, and try to get out just before it reverses. This of course is more of an art than a science, since there is nobody that can actually predict when the market will turn around. External factors can cause it to turn around within a matter of hours.
Day traders rely heavily on what is called "technical indicators" to help them make trading decisions. Most of them have sophisticated charting software to visually represent market movements. The simplest technical indicator is probably the moving average. If you draw a basic chart, showing when the price of the currency moves above or below the moving average, it can be used as a trading signal to buy or sell that currency. 'Trending indicators' is another group of indicators that are highly popular. Many traders swear you can in the first place pick up a trend in the market with one of these, and also predict when the trend will run out of steam.
The day trading industry has spawned a whole set of 'technical indicators', mathematical formulas trying to predict the next movement of the market. The underlying reasoning behind all technical indicators is that the future will in some or other form be determined by the past. This is also the biggest inherent weakness of any technical indicator. The moving average, for example, is used by many traders as a signal to buy or sell. The argument is that if the price of a currency for the car moves above the moving average for a certain period, it will continue to climb for some time. The trend will continue. Trending indicators, who actually try to identify a trend in the market, are more sophisticated tools, but even here the future is extrapolated by looking at the past.
Long term traders prefer to call themselves investors, and most of the time they only look at fundamental factors to make buying or selling decisions. Banks and other investment houses do, however, often make use of basic technical indicators like the six month moving average of a currency.
There are a number of different chart types being used by traders. The simplest is the line chart, which basically just connects the closing prices to each other. A favorite of many traders is the so-called 'candlestick' charts. A candlestick chart shows both the opening and closing prices, and the highest and lowest prices for the day in a colorful bar type chart. Bar charts only shows the lowest and highest prices of the day.
Forex market trends is the subject of many debates, numerous studies, and a lot of conjecture.
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