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What is Guerrilla Trading?

Guerrilla trading is a trading strategy that relies on speed and precision in entering and exiting the market. This strategy is considered high-risk and requires specialized skills. In the context of the forex market, guerrilla trading aims to achieve profits in a short period by making quick and efficient trading decisions.

Guerrilla Warfare Approach in Trading

The term "guerrilla" itself is often associated with battle strategies that are not bound by conventional rules of war. Similar to the principles of guerrilla warfare, guerrilla trading involves trained soldiers (traders) acting swiftly, with focus and effectiveness in dealing with constantly changing market situations.

According to Investopedia, guerrilla trading involves rapid execution in entering and exiting the forex market to gain short-term profits while minimizing risks as much as possible. Using very short time frames, guerrilla traders operate with high intensity, executing transactions repeatedly within one trading session.

Characteristics of Guerrilla Trading

Here are some key characteristics of guerrilla trading:

  1. Limited Position Holding Time: Guerrilla traders avoid holding positions for too long to reduce risks. They typically close positions within minutes.
  2. Small Profits and Losses: Guerrilla traders are content with relatively small profits, usually in the range of 10-20 pips per transaction. They also manage losses in the same proportion.
  3. Multiple Positions: Guerrilla traders often open multiple positions simultaneously, especially before the release of significant economic news.
  4. Relying on Technical Analysis: Due to their focus on short-term trading, guerrilla traders rely on technical analysis to determine the right timing to enter the market.
  5. Prioritizing Low Spread and Commission: Guerrilla trading emphasizes minimizing transaction costs by choosing liquid currency pairs and brokers with low spreads and commissions.

Requirements and Tips for Guerrilla Trading

To succeed in guerrilla trading, a trader must meet certain requirements and implement some tips, including:

  1. Making Quick and Accurate Decisions: Guerrilla traders must be able to make trading decisions quickly without being influenced by emotions.
  2. Trading Without Emotions: Guerrilla traders must trade without being overly influenced by emotions, whether it's greed when making profits or regret when facing losses.
  3. Pay Attention to Money Management: Good capital management is crucial in guerrilla trading to avoid uncontrolled risks.
  4. Sufficient Trading Experience: Guerrilla traders require sufficient trading experience to deal with challenging market situations.

Guerrilla trading is a challenging strategy that requires skills and sufficient experience. Although it offers the potential for quick profits, guerrilla trading also involves high risks. Therefore, it's important for traders to understand the characteristics and basic principles of guerrilla trading before deciding to implement it.

Thus, guerrilla trading can be an effective trading strategy choice for traders who have the necessary skills and experience, as well as a good understanding of the risks involved.


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