The 1 TICK CHART SCALPING METHOD

Here is the current method i use to trade during the London & NY sessions. Nothing too complex about it, but does require discipline & practice of price action reading skills. I will try to keep it as simple as possible, and will be open to suggestions or questions about it. I usually make 20-40 pips/day, and I find this method quite consistent for myself. If you believe shorter time frames are “noise” then this is not the method for you. Also if you are not interested in putting in screen time - then forget this.

STEP 1: PLAN YOUR DAILY LOSS LIMIT & MAX POSITION SIZE - Losing excessively leads to foolish decision making, revenge trading, and using too much size. I cannot trade without this strict discipline, and deciding these factors before hand. NEVER opt to change this plan in the heat of the moment. Just my advice.

STEP 2: CHART SETUP: The pairs i trade this method currently include EURUSD & USDCAD. I use a 5 minute chart and a 1 tick dot chart for each pair. I also check the 15min & 1hr to plot key levels. The 1 tick dot chart is available on the cTRADER platform. Also, you should use an STP ECN type broker - variable spread, commission type if you are scalping.

STEP 3: STUDY ENTRIES: Typically i am looking for a bounce or push off of a support/resistance level, or also breakouts - although probabilities suggest more breakouts fail - and so the primary method of entry is off a bounce. This aspect of monitoring price action cannot be taught as theory. You must put in the screen time, and chart study to develop an eye for entry.

THE 1 TICK CHART: While some people think it is madness to use a 1 tick chart. It is a useful tool to understand the volume of the market, and the pace of order flow. You can see the spread better, and note points where spread widens, and there is tension in the order flow. It will tell you things that will be missed on a candle chart. It is also highly effective for scalpers to use as an exit for trades, since one can trade from the chart and exit a trade by placing a stop as tightly as needed. Here is a screen shot, that shows the order flow in USDCAD - note the mini trend and swings.


STEP 4: SCALE UP or STOP OUT. This is the KEY to the method, and achieving the size of gains necessary to outpace the losers. When the trade goes your way, quickly add to it, and position as the market turns in your favor. This is also the aspect that requires the most discipline. If you have added and the trade is not going your way. Clip it! Essentially, you test the market with a small sized entry, and add as it goes your way. I will allow myself to average down only once, and only in certain circumstances. If at this point it still moves against me - I STOP out immediately. Do not hesitate to do this. On the other hand, don’t be afraid to pile in when the market is turning your way - this is where the big wins are!

STEP 5: EXITS. If price is not spiking your way - I take the profits and get flat immediately. If price does spike your way - Exit half or more of the position, and put the remaining stops in the money. With at least one portion of the trade - trail the stop on the one tick chart and keep setting it below the mini swings. This is an excellent way to maximize the profits on a trade, as you can keep following it as long as the spike continues.

FINAL NOTE: this is a method that requires practice, speed, and a keen eye for the movement of the market. I find I have thus far been able to trade consistently using this method - and it works for me as an action kind of person. Keep in mind though not to overtrade and be patient as with any style of trading.

Hope this helps - if anyone else is doing something similar - let me know!:44:

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Interesting. I like trading super short timeframes. 5m is a bit too slow, and a 1m chart feels like an arbitrary number. I’ve been messing with 9, 13, and 21 tick charts in cTrader as well.

What do your typical SL and TPs look like?

Good ideas to put into practice, very good info and useful.

Stops are not typically wider than 10 pips, although in different instances i will give it a little more room to breathe. I very much go by feel - ie. is price chopping around a level? I will give it more room, however if the bars and the order flow are “sticky” one way, with little pressure back - and i am on the wrong side - i will pull the plug even if 1 pip down. Take profit varies between 2 - 12 pips typically, although with the trailing method i talked about - i get runs where i can catch 40 pips. The real key, regardless of timeframe, is to add when the trade goes your way. If you catch a few good pops doing this - it will give you a profitable method so long as you are not adding much to your losers. This is something you don’t see many new traders doing, since you are getting a worse average price, but you can often get out if it starts to move against you with minimal damage, and when you do catch a spike - you’ll bank. The advantage of a one tick dot chart, is when you manually trail a stop it is much easier to tuck it in as tight as you need and monitor the order flow to see where it makes sense to place it - something you cannot see on a bar chart.

I played around with this method today. I’m definitely liking the feel of this 1-tick style. While I wasn’t profitable, nor did I even have a plan, it was enlightening.

Here’s a beautiful USD/JPY chart with tons of opportunity. This was during London/NY session. You could trade bounces and breaks. Notice the psychological levels at 115.200 and 115.100. A clean 10 pip micro-trend after the 115.100 double break. What do you think of this chart?


That’s interesting. I actually don’t trade the USDJPY much, but that chart makes me curious. With all the automated trading done on the USDJPY, I would imagine it has a certain kind of technical precision in the order flow, as your chart illustrates. I will take a look during the next session. I personally like to reference a 5 minute chart too as it has reasonable technical relevance. Trading a one tick by itself, i have not been able to do - i have to look at the larger time frames. When the order flow is clean, I find it easier to read though. On a day like today - the EURUSD was very choppy during London/NY - it can be dangerous as it may look like a certain direction is emerging - when it is only volatility. That chart you show looks much better though. Of course the 1 tick chart is also a great tool for managing trades easily and precisely if you are scalper. Good trading to you!

In the interest of full transparency for anyone reading this - I no longer use this method - and while had some streaks of profitability with it - in the long run I have not been able to profit from this as a full time bread and butter strategy. Take anything here that is useful - but know that scalping the FX market is very difficult in my opinion. Tried very hard for about a year - and could not get consistent enough to keep doing it. Not saying it could never work - but I have moved on to other methods and markets myself. Good luck!

Hey, FX_CANADA! This is achi_Tokyo. Thank you for a good lesson. Are shorter time frames “noise” ? No. I do not think so. I’m a fan of t10 tick line chart which does help me to identify corrective patterns. It looks so simple and clear. To me, candle sticks are the noise because they mess up the chart with different colors and occupy a lot of space on my monitor. Candle stick patterns like “Pin bars”, “engulfing bars” often lie. I think I understand that you like “dot chart”. That must be the real “naked chart”. I’m glad to find you. Good luck in your trading!

Ah mate, this breaks my heart to here. Best of luck with your new endeavours.