🔍 What is Scalping Strategy?
Scalping is a strategy that involves opening and closing many positions in a day, with a very small profit target per trade, usually 1-10 pips (for forex) or just a few dollars (for stocks/crypto).
⚙️ Characteristics of Scalping
1. High Frequency: Many transactions in a day.
2. Small Profit per Trade: Focus on accumulating small profits.
3. Short Holding Time: Positions are held for only a few seconds or minutes.
4. High Leverage: Often uses leverage to maximize results from small movements.
🧠 Advantages of Scalping
•Quick Profit Realization: No need to wait long.
•Minimal External Risk: Not overly affected by major fundamental news.
•Flexible: Can be done anytime while the market is active.
⚠️ Disadvantages of Scalping
High Transaction Costs: Spreads & commissions can eat into profits.
Requires Extreme Focus: Must constantly pay attention to the chart.
Psychological Pressure: High risk of mental fatigue.
Requires high volatility.
📊 Common Tools & Indicators for Scalping
Moving Averages (MA 5, 9, 20): For identifying short-term trend direction.
Bollinger Bands: To see overbought/oversold areas.
MACD & RSI: For momentum and reversal signals.
Strong Support/Resistance Levels: As potential entry/exit points.
✅ Effective Scalping Tips
1. Use a broker with low spreads and fast execution.
2. Choose liquid and volatile asset pairs (e.g., BTC/USDT, EUR/USD).
3. Stay disciplined with small stop losses and take profits.
4. Don’t overtrade — maintain mental clarity and focus.
5. Use small time frames (1 minute, 5 minutes).
📌 Example of a Simple Scalping Strategy (Crypto/Forex)
1. 1-minute TF, look at the trend direction from MA 20.
2. When the price touches MA 20 and RSI supports (30-70 area), enter a position.
3. Target: 0.5% - 1% profit.
4. Cut loss if the price moves against by more than 1-2%.
🧭 Who is Suitable for Using Scalping?
•Traders who have plenty of time to monitor the chart.
•Those who are highly disciplined, not emotional, and can withstand pressure.