Forex scalping is a popular trading strategy which involves the fast opening and liquidation of market positions. The time is generally very short, nearly about 3 to 5 minutes at most, and scalpers normally maintain their position for less than one minute. Scalping is normally perceived as a safe trading strategy. And because the scalpers maintain their positions only for a brief period of time as compared to normal traders, the risks from a strong market is relatively small.
Should you indulge in Forex scalping?
Before you think about Forex scalping, you must understand that this is not suitable for every kind of trader. The returns that are normally generated in each opening position by the scalper are small; great profits are only possible when the small closed portions are combined. Because scalpers do not like to take big risks, they are willing to let go of high profits or great opportunities in favour of small but persistent gains. The scalper is normally a diligent and a patient person who is willing to wait for a substantial amount of time for greater profits.
How should a scalper trade?
In case of Forex scalping, the first thing that a scalper needs to do is be attentive. In case of scalping, a lot more attention is needed from the trader when compared to other methods like swing-trading or following a trend. On an ordinary trading day, scalpers will probably open and close tens and often hundred positions without compromising on the safety range. They cannot allow any of the positions to suffer great losses. They need to be alert and attentive; in no way they can forge a great profit in some positions, and be negligent about other positions. Scalping demands attention and the method can be pretty involving. This trading style is quite fun, but the trader needs to be well-acquainted and comfortable with the practices and habits.
A final word of wisdom
Like any other form of trading, scalpers must maintain consistency in trade sizes while using this method. Erratic trade sizes in scalping are one of the most assured ways of having a wiped-out Forex account. The basic principle of scalping is that profitable trades will somehow manage to cover the losses of failing trades after a certain point of time. But not often can you afford to pick up random position sizes. The amount of cumulative expenses will be more than you expect. In case of Forex scalping, it is important to pursue a predefined strategy with persistence, patience and attention.
Know your trading skills and try to find out whether they are suitable for Forex scalping; and you may earn quite a profitable amount!