FOREX SCALPING STRATEGIES - EVERY DETAIL YOU NEED TO KNOW
In case you might not know, forex scalping strategies are one of the most common forex trading strategies. Indeed, because it is so easy to learn and practice, every beginner tries it at early stages in forex trading. We believe that all traders have at least once tried scalping. In today's article, I will explain to you what scalping is, why it is popular, and what it takes to become a forex scalper.
What is forex scalping strategy?
Scalping in forex trading is a term used to describe the action of surfing the market to earn little profit repeatedly in a small amount of time. Scalpers use this strategy by open and close positions many times in a trading day.
Sound like Day Trading strategy right? Scalping is not like Day Trading. This forex strategy secret is that the scalper would open a position and then close it within that trading session. Scalpers never keep their positions open over the next trading session or overnight. Another difference is that day traders would check their positions once or twice a day while scalpers have to constantly check them every minute and try to surf as fast as possible to earn little money for many, many times in a single trading day.
Usually, a day trader prefers the M5 and M30 charts. On the other hand, scalpers often use M1 forex trading chart, sometimes even tick chart.
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Why is forex scalping strategy popular?
Scalpers are traders who try to win 5 to 10 pips for each order and repeat that over and over again during a single trading session. They prefer high leverage. They are always ready to close a position with a little profit.
Why do people like scalping even when they just make very little?
Well, because that’s not true at all. Do the math yourself.
Remember, for a standard lot, a pip is equal to 10 USD. Therefore, for 5 pips in profit, a scalper make 50 USD. Sounds familiar to the 50 pips a day forex strategy, right?. No. If you can win like that ten times a day, you can earn $500 daily.
What does it take to be a scalper?
Scalping, sadly, is not for everyone. Make sure you have what it takes before choosing this strategy. Scalpers must sit in front of the computer screen for the whole trading session, and they have to pay absolute attention to the charts all that time.
Not only your endurance is tested, but your reflex as well. Scalpers must catch the slightest movement of the market in seconds so as to make profits from that.
The forex market is a very large and liquid market. The forex scalping strategy is said to be one of the most efficient strategies for a forex trader. Yet, remember that scalping usually requires traders to have a large deposit. Traders also have to be able to handle the high leverage rate while making short and small trades.
Scalping is very fast-paced. Everything happens in just minutes. If you live for the thrill and can focus on one or two-minute charts, scalping may be suitable for you.