This thread is dedicated to scalping using price action analysis. Timeframes 5 minutes and lower.
Here is a review of the 2 minute chart for EURJPY on 29th Aug 2013. Descriptions below chart.
A Small trendline is developing, lower highs and lower lows forming, moving averages have rolled over signalling short term momentum is changing. Price forms a small rejection candle off the moving averages and trendline, price has also reacted several times at this area in the last 15 candles. Entry on the close of this candle and stop above (approx 4 pip cost with commission). There is the opportunity to take 2R out of a trade like this.
Tips: When scalping the 2 minute chart your intuition comes into play as execution needs to be quick and efficient. Using a fixed stop loss of, for example 5-7 pips, for all trades allows for one-click trading, consistent lot size and risk per trade.
Price forms a flat bottom with 4 attempts to break lower without success. Price then forms two inside doji candles in a row. Entry on the close of the second one, stop loss of 5 pips, 1:2 risk to reward achieved on the next candle.
Tip: Given the strength of the momentum drive back up you can look to hold onto the position with a wide take profit. Many times at the start of the session you can get in at the ground floor and ride the move for significant value so long as the momentum holds.
Price is slowing down and reacting multiple times, price then breaks through this level and rejects back down, then forms another red rejection candle. Entry off either one of the two, stop loss 5 pips, price runs back down to the previous area of resistance from earlier on in the session and makes a 50% retracement of the move up. Potential for 1:2 risk to reward on this trade.
Rejecting off the previous area of resistance and 50% retracement of the last move up, also off the 50 EMA and in the direction of the short term trend. Entry on close, 5 pip stop, 1:2 risk to reward potential.
Price has tried to go higher multiple times but has failed and formed a trendline. Price rejects off the trendline with moving averages coming back together and closes well down the previous candle. Entry on the close, stop 5 pips, take profit potential 20 pips.
Price drops back down to form a double bottom from earlier in the session and reacts strongly off this area. Entry on the close, stop 5 pips, 1:2 risk to reward possible.