Forex Scalping - Consistency is the Key
- Charles David
- Jun 5, 2019
- 3 min read
Forex scalping trading is not for everyone, but it is suitable for a very specific type of trader. Many Forex traders use FX scalping as their primary trading method.
What is Forex Scalping ?
Forex scalping is a trading style by which the trader makes quick trading calls and small profits by opening and closing new positions within minutes. Life of scalped trade can be just between three to five minutes, with the majority of such trades staying open for as little as one minute. Scalping FX is a very popular trading method because the risk of staying in such a volatile market is minimized when scalping. Since life of trades are only open for a minimal amount of time, the danger in a fluctuating market is much lower than in traditional trading methods due to a lower level of market exposure.
Talking about Day traders they are mainly focused on concepts like trends and ranges, scalpers are mainly concerned with the bid/ask spread. The volatility of the Forex market, therefore, affects scalpers less than a trend follower or day trader.
Forex Scalping is possible for Everyone ?
Scalping Forex is definitely not a suitable trading method for the majority of FX traders. Profits made from scalping in Forex market is much lower, and the scalper depends on many small profits as opposed to making it big with one specific position. Scalping technique lowers your risk as a trader, and on the flip side, lowers your potential for great profit.
Understanding human nature and trading psychology into account, the scalper need to be a patient and diligent individual who is willing to forego the desire for instant gratification, and wait patiently while their trading account grows. An excited and impulsive trader will achieve nothing by scalping.
Another reason which becomes necessary for successful scalper is a high level of concentration. While some day traders might open a position, go out to eat, then come back and close the position based on the latest market developments, the scalper must be concentrated on their open positions at all times, and have their finger on the trigger, in preparation for their next move. It requires a serious attention span as well as the ability to stay glued to one screen for an extended period of time.
If you are not a full time trader, and do your trading on the side, you must realize that scalping is a time consuming technique that might not be suitable for your schedule.
Consistency is the Key to FX Scalper
Forex trading normally requires consistency on the part of the trader. This becomes a major responsibility when it comes to scalpers. Trading unpredictable size positions will eventually lead to losses on your trading account. Scalping method, after all - is based on the principle that your small profits will overpower your losses. This will not necessarily work if you open large trades, and lose.
Keep the size of your trades consistent, don't get greedy, and you are very likely to benefit from the scalping technique assuming you meet the above requirements.
You can read more articles about Scalping in Forex which I have written in past.
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