As a beginner what benefits would I gain from Scalping?
Opening the Advil bottle…
Seriously, Its best if you learn to trade Higher timeframes first. Just get that out of the way.
Then, when you have a great understanding with that, drop to the lower timeframes to find best entries that CORRELATE with your longer timeframe assumptions.
If your scalping for 3-5 pips, I suggest using the 5 second chart, as entry is Most important, and every pip is of great value.
But like I said, learn higher time frames, Learn heat map reading, Learn News events, mainly the Time of them, and ALL OF THEM. The weirdest things can happen, regardless of what pair your trading, or what time of the day.
For now, keep notes of the news per calendar from myfxbook or something like that, and dont trade 1 hour before, or 1 hour after.
Practice, Patience, persistence is needed to be a great scalper.
And take this into account, We have our pitfalls. Its about getting better with every trade, writing down why you lost, and keeping track of YOUR mindset.
after making changes constantly to my system, since yesterday, Im up 57%, and 16 wins, no losses.
create your style, and your system. Scalping is as hard as you make it. Its taken me years to get things where they are today.
Good luck buddy,
As a beginner, none, I think.
I’m not [I]far[/I] from being a scalper, myself (as most forum members use the term, anyway) in that I trade relatively frequently from intraday forex charts aiming to accumulate a fairly steady flow of small profits, but even I find it very difficult to think of (m)any advantages for a beginner. The very large number of [B]dis[/B]advantages, on the other hand, come to mind very readily indeed.
Scalping is one way (strategy) of trading and if you feel that you have enough trading education you can try , but do not expect any benefits because like any other type of trading, it need experience and consistency to be reached.
In my humble opinion,
I think scalping improves your concentration and stamina. IF your strategy on 1hr chart and 1min chart is SIMILAR in nature, it might just shorten your learning curve. On the flip side, scalping can become an addiction, and if there is a lack of wisdom on your part, you may end up on the longer pathway to Rome.
Scalping is the quickest way for a beginner to go bust.
Try a bigger timeframe where you will have more thinking time to plan and manage your trade.
Scalping is great when you’re winning, quick money in a few minutes, but its a b#####d when you lose and watch your account crash and burn in seconds
I could not agree more…
I thought I liked to open lots of trades when I started, and that it was exciting to ‘scalp’… Not only, in newbie hands, was it the fastest way to compile losses, but it was also extremely time consuming… I thought that to be a trader you had to be actively pressing buttons most of the day…
As Lexy says, and as Bob says (on another thread), some professional traders actually trade for small pip amounts and once they reach that target they are done for the day… Maybe they are scalpers, maybe not, but the concept is still that of capturing small moves to ensure highest probability of success.
As MoneyNVRSleeps says, also, higher time frames are actually better for seeing things with more clarity, for example trends and market sentiment… Remember that the big money takes the market where it wants it to go, and we, the hamsters of the trading world, follow the trail of crumbs, hoping to pick some up without getting harmed…
So avoid ‘scalping’ unless you are a newbie with coolant liquid in your veins and a synthetic brain: euphoria can grab you and you can get caught out…
- Scalping involves fairly low risk as the losses are low.
- Scalping opportunities are plentiful, throughout the day.
- Scalping allows for diversity in markets, trading in several
different markets at once.
- Scalping can be profitable even if you trade only a small
amount each day.
- Over time, profits add up and can reach great value.
Most of the above is true, however, as someone who mainly trades scalping methods (along with other techniques) as part of my income I have to disagree with point No1 from naawaa
although individual trades may be fairly low risk, in order to make decent profit scalping you need to trade a number of times in a day which is increasing your overall risk. Try and tell a scalper who has had 5-10 or even 15 trades run against them that it’s low risk. And it’s surprisingly easy to have 15 trades run against you if you’re new to trading.
Scalping can certainly be profitable over time but…
Scalping as a pure newbie is very risky as without enough knowledge it just becomes gambling. I’ve learned over years to take opportunities against trends as well as with them and that’s when scalping becomes most profitable in my opinion.
You can also trade many different currencies/markets but honestly you really don’t need to. If you monitor only two or three currencies constantly you spot the setups quicker and know the S/R inside out and, although I’m sure I’m not the most experienced scalper on BP, that for me is what makes the difference when scalping. Knowing when to enter and when to exit quickly, almost without thinking is absolutely key.
A Strong understanding of price action is what I rely on daily, but there’s always room to learn more. For me scalping needs to become a reaction to a setup and I’m not quite there yet.
I disagree with this one, for the reasons already explained above by Shyfx.
I see that as a drawback, rather than as an advantage, for beginners: the temptation to overtrade is something to be guarded against, I think. Having “plentiful opportunities” rather counteracts the necessary acquisition of patience and discipline so essential for successful trading.
The same applies to this, too, I think. Together with the desirability of concentrating on a single market, during the initial stages, rather than being a gadfly.
The same is true of other types of trading, apart from scalping. In fact, I think most experienced traders would say that it’s [I]more[/I] true of other types of trading.
This is true of all types of trading. With scalping, some of its problems are that the proportion of trading-costs to profits are clearly much higher, and that losses can also accumulate to significant amounts.
So to the extent that your points above are actually valid, I can’t help thinking that they’re perhaps more arguments against scalping, for a beginner, rather than points in its favour. :33:
Once again, Lexys, a very helpful, cogent, and well thought out response! Thank you!!
Scalping involves frequent trading as a result more profit for the broker.Why some brokers don’t allow scalping?
scalping is be a good strategy to start, but you might get addicted to it since you can just make bigger lots to cover your lose.
It not suitable for everyone, and account type you have might effect your trading efficient as well (spread, speed of execution, commission)
[I]Genuine[/I] brokers allow scalping. They have absolutely nothing to lose from it, however well or badly the client does.
Some [I]counterparty market-makers who are pretending to be brokers[/I] won’t tolerate it, though, if their clients are any good at it, because they hold the other side of their clients’ trades and they’re the ones being scalped.
In other words, no broker minds clients scalping [U]the market[/U]: they just don’t want clients scalping [U]them[/U], but the ones who are in that possible position aren’t really “brokers”, [I]per se[/I].
As a beginner you will see no benefits from scalping or any other way of trading, which means before you think about benefits you should spend a lot of time on a trading education.
I intended to be a scalper since I think it’s the fast way to make money.
but after reading these comments, I changed my mind!
maybe it’s the fastest way to go bust as well
We Go bust because of the practice of large stoplosses. The only way to loss money, is by being wrong. The bigger your Stops, the more your wrong. So, how wrong do you think you need to be? How do you measure “Wrong” or “Wronger”, lol… Sounds dumb, huh.!
IF you want to use less risk, because your not confident in your system, break your equity into 5 parts. That gives you 4 trades to add if your wrong, or just get your stops to a fixed number.
You really need to know the current momentum and strength of the pair, along with the intermediate trend.
But the whole meaning of scalping is raking in small wins, going with the flow. But you HAVE to be going in the right direction, and ONLY in that direction. You can bank nice, fast profits compounding, taking small chunks when the price lets you.
SO, here is the moral of scalping.
You Go BUST when your wrong all the time, or your stops are so far out that recuperation of lost equity gets further outta reach with each pip. You MUST be right above 90%. And you MUST be consistant with your ROUTINE, and Rules of your plan.
Im a very firm believer, 50 pips in the hole, is that threashold of Lost time and money. In scalping, 6 pips is a good number to say your entry is bad.
If your a scalper, you need to key in on the entry. Having a FXBook is great for this purpose, because it tells you the numbers.
Entry is the most important key to scalping, and, really, quiting for the day is the other.
You can bank 5% a day on 1 good entry. My problem, is I want 50% a day, or 100% a day.
You wake up, run thru your plan, make an assumption, make the trade, Win, walk away, day over in what, 20 minutes? I know I make it sound to good to be true, and I know Im a poor example to success, lol, I know i know, But its entirly true. Ive done it, I just dont do it well, because Problems of routine checkdowns and rouge entries just because, and moving my stops. I outlined everything of keys to ME failing at it,.lol…
I good to go now tho, My plan is straight, my confidence is up. I fixed all my problems. This is a big week for me.
One thing I hate, Fridays at 4:59PM est.
Very true of scalping, and certainly not dumb.
Indeed … exactly so.
Yes, I agree with all of this. I think 6 pips is a good number for spot forex scalpers to say their entry was bad.
Lol, I agree with all you say, apart from the finishing time on a Friday: if I do Fridays at all, I’ve finished by lunchtime EST.