The 50 pips a day forex strategy isn't a strategy for everyone, but it's worth a try if you want to start with money markets and make a profit of 5 to 10 pips per trade. Try doing a small calculation, with 1 standard lot, the average value of a pip is about $10. Thus, for every 5 pips of profit, the scalper can make $50 at a time. If you repeat that process 10 times a day, your earnings will be $500. Surely this is quite an impressive result worth you learning about this day trading strategy.
Indeed, 50 pips a day forex strategy can be categorized as forex scalping strategies in trading.
Scalping can be defined as a short-term trading strategy aimed at closing lots of orders from small price changes. Traders apply this technique to make from ten to hundreds of transactions a day. Scalpers believe that it is easier to capture the small movements of the prices than the big ones. Many small gains that make up during the day can become big if any and apply strict stop-loss rules.
Scalping is an activity that requires fast and accurate speed. In addition, to succeed requires a clear scaling strategy, scalpers must strictly follow that strategy.
Scalpers should use momentum indicators like the RSI or other MACD indicator... Also, it is advised to use indicators on price charts. Some common ones are the MA, the Bollinger bands or the pivot points. You can use them to identify support levels as well as resistance levels.
The scalping strategy like the 50 pips a day trading strategy relies heavily on the technical analysis of the traders themselves and short-term movements of the price. Because high leverage is used to improve the profit value of each trade, this strategy can be relatively risky if you don't have a good risk management plan.
Criteria for evaluating a scalping strategy
To apply this scalping strategy, we need a currency pair that fluctuates greatly. GBP/JPY is a great one. It can fluctuate from 150 to 200 pips a day. Do not choose a stable pair. This strategy does not work at all when the market is flat or the trend is unclear. Now let’s see how it works:
In case you're interested:
Now you know how to apply the 50 pips a day forex strategy. Let's give it a try to see if it can hold up to the reputation.