What can combine all traders together? – Right, a desire to earn as much as possible within a short period of time. Every trader dreams about minimum risks and maximum profits. Yet not all traders reach such amazing results. So what is the secret of successful investors? Maybe there is some innovative strategy? As it is said: “Genius is simplicity”. And in our case the secret Holy Grail is hidden in a scalping trading strategy.
Scalping Trading Strategy: Myth or Reality?
In simple words, scalping is a short-term method of a pretty aggressive trading without affecting global processes of the market. The profitability is provided by means of “cutting” a thin layer of liquidity from local price diapasons.
A lot of traders prefer to call scalping trading strategy – pipsing. And it really does make sense because during one trading session it is possible to make a big number of trades (from 10 to 50). The position closes as soon as the price reaches a few pips in a planned direction. Liquid instrument is found, a necessary amount of money is withdrawn and back to searching the next asset.
Scalping causes high psychological and emotional tension which is accompanied by a high quantity of aggressive trades. During the trading process, a trader always tries to follow a complete tactical efficiency as well as maximum concentration and attention.
If a trader lets his guard down even for a second – dozens of profitable moments for making short-term deals will be missed. These are the main disadvantages of this particular strategy.
- The most important scalping pro is the ability to use it even with minimum amount of money on a deposit. This fact is considered to be very significant for 90% of traders worldwide;
- Traders don’t face big risks when using scalping trading strategy. Users can make mistakes regarding the direction of an option many times, yet it is very hard to provoke a strong deposit loss. In case if you experience some losses and keep moving in a wrong and negative math way – reconsider the criteria of an algorithm. Find mistakes and avoid them;
- In a scalping strategy it is pretty easy to find entry points for opening short-term positions. Any chart with price fluctuations gives traders a wide range of opportunities for profitable trades;
- Unlike many other strategies, there is no creativity in scalping;
- A complete absence of intuition, creative element and long analysis make scalping a systematic kind of income. What else one needs for a success in a financial sphere?