That’s bold. Sounds like you’re stepping outside a comfort zone. If so, that’s really awesome.
Week closed with loss almost at the limit.
Points for next week:
- not overtrade (harder than it looks on M1)
- keep booking very small profits - this week win ratio went up, but average profit : average loss is poor due to overtrade and allowing trades to be closed on stop loss. Looking to improve this further and maybe not hit the weekly limit next week
- added D1 High / Low / 50% levels to see how price will behave around these on M1
- added price alerts on my platform around next levels above and below current price (S/R, D1 High/Low/Mid, Pivot). It feels like sitting in front of chart and waiting somehow makes me itchy and contribute to overtrading.
- still looking for convenient workspace setup for my charts - in longer term trading there is enough time to switch between timeframes and currencies, at M1 I need to have some better oversight.
- Focus This week I’ve had one stupid loss just because I’ve clicked instant buy button on my broker station instead of changing timeframe (these are ridiculously close)
Results so far
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I love how detailed you are if you keep making small improvements you will see massive results
@wilczasty I can so relate to the last point. I also commit some silly mistakes like these. Presence of mind is really important.
Given that you’ve recently shifted to scalping, these are good results. Keeping your losses under check is a great achievement.
Do you use ATR (xx) as an indicator and to set your risk per trade? If so, on what timeframe and how many pips do you typically risk and how much profit pips do you consider to be a useful successful trade?
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For this scalping exercise don’t use ATR (although I am a fan of ATR for longer term)
I’ve set weekly loss limit at 10PLN which is less than 30 pips total with spread being anywhere between 0.8pip - 1.4pip.
There is no luxury of having room to breathe for trades.
I enter mostly on M1 after price pulls back to broken level and prints new candle in the same direction as break of level after the pullback.
Then, stop loss is above high of the “entry candle”. This means even smallest SL possible is relatively huge = 3-5 pips including spread.
Looking at how these trades play out, I can tell after 2.5 week, that I will be considering ANY green trade as a successful and look to achieve positive expectancy by very high win rate with very poor risk:reward. 1 PLN - 3 PLN risk to take 0.2 PLN - 1 PLN profit.
On M1 these micro movements seem to me to be driven by very short supply/demand bursts, which are quite detached from higher timeframe tides.
Whenever I try to catch something larger than 1-2 pips, correction takes my SL or forces me to manually abandon ship. In other words, even if I read D1 > H4 > H1 market structure correctly and at the end of the day it moves as I plan - I am being pushed around on M1
So my tactic will be to book in whatever is green and work on win rate = selecting best pull backs and making least mistakes possible
Did you try, for example, moving to M15 and trading on the 1 hour start of new candle? the problem I had during the brief periods I was trying to scalp (about a decade ago) was that “I was being pushed around on M1”. I felt I had a lot more control and thinking time when I moved to watching price action on the M15 with a view to entering in my zone of interest at the start of a new H1 candle. At least I had time to do other daily chores like paid work in between. And that is eventually why I moved back to swing because I was spending too much time “during the normal working day” that it may have affected my overall productivity in my consulting. So I decided to take all training and decision making outside of the scope of my working day (i.e., not after 8am and not before 17:00 hrs)
That is a very good advice. I don’t treat this extreme scalping as anything more than exercise or learning experience. Apart of that, I am trading anything between 1D-15M, yet I wanted to run this journal as some kind of learning journey / improvement thought process in totally new area of trading. I will stick to 1M until I don’t see room for improvement (or just get bored).
What I like about 1M is how visible is momentum - candles move in variable speed and you can see how speed drops at some levels and new buyers/sellers come into play to “defend” the levels.
The case of spending too much time is really important. To avoid this, I am setting important levels at the end of the day and put price alerts on my brokers platform. This way, if price reach nearest important level above or below, I can jump in for few minutes and see how it plays. Definitely not a fan of sitting all day in front of a chart 
@Mondeoman it’s a real pleasure discussing with you. Even, if my M1 journey will fail, I am sure other traders will find value added in our posts and exchange of views
Scalping in the forex market involves trading currencies based on a set of real-time analysis. The purpose of scalping would be to make a profit by buying or selling currencies as well as holding the position for a very closing and short time it for a small profit.
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This is definitely true, but what is the value added of your comment?
Good RR is a must for any trading plan/strategy.
You need at least a 1:1 to weather out a bad patch of trades
I dare to disagree.
Let’s have a thinking exercise.
If 0.3:1 RR is bad and 1:1 is better and 3:1 is very good… why don’t we aim for 100:1 or 1000:1?
Because usually you can expect higher win rate with smaller target. The problem is, that to have profit in the long run, your win rate must be high enough to compensate for negative RR. Similarly, you can have lower win rate, to profit from 3:1. It’s about balance between how much you can want (RR) and how often you have the chance to get it (win rate).
Hard pill to swallow - market does not care what RR you want. The fact you want to take three times your risk is worth nothing on its own. You need to have some data (backtesting?), to prove this has positive expectancy.
We are dealing here with purely discretionary trading, where hard to grasp (and program) quality of signals come into play and we are looking at 1M timeframe. So how do you draw conclusion, that 1:1 RR is right in this case?
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And me with you too. Sometimes, I feel I know the answer and could write it in 3 words. But for the benefit of other members (and me too) I often go to my own “Open Plan” for Forex trading that I maintain in MS OneNote - where I can write free form. When I have written a response to a forum question, I go to the relevant section of my trading plan and transpose that free-form text response into a paragraph and save it in that specific section of my trade plan (open plan). Every so often, when I revisit my trade plan formally, it becomes the next version incorporating these answers to forum member questions. It is currently about 85 pages and needs a tidy up. But it is only by answering these questions at a level I think the newer members can understand that I continuously update my own plans. It gets a bit complicated because I have four to six plans on the go at one time (2 Forex, 3 Crypto, 1 gold and silver) besides other plans not involving Forex. But I am happy to maintain these details - they help me put things into neat boxes.
In fact, most traders are like sheep they lack an edge and never think that forex trading is a business that requires insurance which is a stop loss. Managing a trade without a stop loss is risky especially if you are not stationed on the machine. I do not believe in traders giving rules and strategies because personality differs. Emotions keep on changing. Having a weekly stop-limit may be a good practice but I consider available opportunities in the market, not the take profit targets. In my opinion, all traders must develop and identify what works for them if they are to be successful. Look for opportunities but not money in this unforgiving market. As a trader, you will only be successful by judicious use of stop loss and proper trade size. Managing risk in trading is a lifetime endeavour.
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Friday Morning Trade
I must admit, I have a problem with sticking to simple rules. Ego + charting experience makes me want to improvise. Below example of very good trade, but breaking the rule of protecting capital and overtrading. Happy for the profit and thought process, shame on not sticking to rules.
Scenario:
- We have strong upward move supported with supply (increasing volume)
- Price reaches very strong resistance area (bold pink cloud)
- Price tests it twice with lower demand on second hit (lower volume). I see it like a huge, heavy doors (resistance) and bull here is coming to the door and knocks weaker and weaker - this is not a way to break through.
- Resistance works, and supply is taking control (rising volume on lower prices). If this would be a small correction, we would likely see weak volume supporting the move.
- So far everything goes according to the plan. I open a short.
- Price goes up and this is where I deviate from the plan. I see that despite price going up, demand is not strong (volume does not support the move) so I start to average down placing 5 shorts across the green box. Third knock came with huge bullish candle but still with weaker volume than previous knocks. So I waited and closed out on the rally down with five good profits (as for scalping).
This was probably one of the few trades (in my whole trading) where I felt I knew exactly what is going on and acted on it. I am fully aware that next time such confidence can lead me to loss, so it is somewhat bitter victory Cheers!
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It was crazy week.
Yesterday I was almost at the risk limit for the week and decided to introduce volume to my analysis.
After few not bad trades and above scenario I’ve managed to pull 90% win rate on Friday and decrease the weekly loss (just slightly 
)
Summary
- Losses are too big. It seems I cannot leave even slight margin above spread to have acceptable RR / WinRate.
- Volume provide GREAT help on 1M chart. I can much easier disregard weak candles and - what’s more important - entry almost on extreme levels where supply / demand vanishes. Hope to keep good accuracy with volume on board.
- I need to think about solution for correlation trades. On longer time frames I have time to look on different highly correlated pairs and select one with best signal. On 1M it’s too fast, so maybe new layout for charts will be needed.
It is advisable to change the strategies from time to time so that you could make the most of it from the Forex Market.
I don’t understand the reason for your post
Is it some kind of fad to write random true statements?
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I think ATR is so key even in today’s choppy markets it gives you a dynamic edge rather than going for X amount of pips. Ive been using it for a while now with nice success
@CraigForex2020 - This makes sense on slightly higher timeframes. On M1 EURUSD ATR(14) oscillates between 0.3 - 1.5 pips with with spread around 0.7 - 1.2 pips. For scalping where I hunt only for slightly green trades looking at ATR is somewhat waste of time, as for 1 ATR I can just look few pippetes above spread and multiple ATRs would meen unacceptable risk per trade.