Hello,
to those of you scalping on 30sec/1 min How tight are your stops? Is a stop loss of 1 pip or less example,0.8 a good idea? I am trading reversals using a set of bollinger bands. Getting the entries right is very important. I may get stopped out more with tighter stops. But I am making more trades, and have more chances of a successful trade.
So for anyone scalping, how tight are your trousers? woops… I mean shorts.
Right off the bat you’re setting yourself up for screwing up bigtime.
1st) A stop of only 1 pip almost ALL the time will get eaten by the spread. Basically you’ll open a trade and be out with a loss because the spread is most often 1pip or HIGHER.
2nd) I see this now with many scalpers having a fixed stop while scalping PA (price action). You have to be reasonable. When you’re trading price action, you’re trading in reaction to PREVIOUS levels of importance, whether that’s a one minute chart, or a 15minute chart. What you need to do is identify the nearest support/resistance, and have your stop below/above that point; what your stop then functions as is a barrier to which you know you placed the WRONG trade.
There are strategies which used fixed stops for scalping however those are built around MOMENTUM. If you trade momentum swings when scalping, your in and out in a few seconds and that’s when your protective stop may be 5 - 8 pips depending on the pair and spreads. Example of momentum scalping is selling at support looking for the breakout, or buying a key resistance area looking for a break upward. These moves can net you pips in seconds, but they can reverse just as quick, hence the tight stops.
Hope that helps, I notice your low-ish post count. May I assume you’re new to forex?
Depending on the market, my stops differ from 4-8 pips
First- I am not a scalper. I can’t control being impulsive if I don’t already have a very set and researched trading plan.
When I did scalp, I liked having a 7-10 pips stop loss. It’s important not to take 4 pip wins and 40 pips losses.