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What is the difference between long term, medium term and short term?

Short, medium and long term are difficult to define, because they have no precise meaning and each writer will tend to have a different definition. Even the same writer may use them differently in different contexts. That is part of the beauty and flexibility of the English language. However, I will try to give some guidelines.

One of the most difficult areas of technical analysis is concerned with the analysis of time frame. The terms Long/Medium/Short term are used widely and do not have a precise meaning. In most situations, they depend upon the concept.

Types of trading and investing are often split up in this way:

Day Trading - trades are opened and closed within a day. No positions are carried over night. Short term for a day trader is seconds or minutes. Medium term is tens of minutes to maybe an hour or so. Long term is hours.

Short-Term Trading - trades last from part of a day up to several days. Short term will be a few hours to maybe one or two days. Medium term will be a few days. Long term will be several days to maybe a couple of weeks.

Position/Swing Trading - trades last from several weeks to several months and may even be held for a few years at the outside. Short term will be a week or more. Medium term will be several weeks to a month or more. Long term will be several months out to a year or more.

Long Term Investing - Investments last from a few years to many years. Short term will be a few years. Medium term will be a few years out to maybe a decade. Long term will be a decade to several decades.

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