If you want to start scalping on Forex, you need to rethink your overall infrastructure.
Step 1. Select Brokers
Scalping is different from ordinary day trading and tends to cause many problems for brokers because of the large number of orders. Some brokers do not allow scalping at all; others raise spreads which makes scalping unprofitable.
These are the things you need to check:
- Small spreads. Some brokers offer Premium accounts with spread 0 with additional fees, be careful with these conditions.
- Leverage. If you are confident in your scalping skills, leverage is a very good way to increase profits. Just learn the broker's call call protocol; sometimes this protocol is not suitable for scalping.
- Trading platform. You have to get to know the trading platform like getting to know your own palm. The trading platform must also make it possible to manage orders quickly, ideally in just one click.
- Speed responding. A slow brokerage system can result in slippage and sudden losses from positions that should be profitable. Always check how responsive your broker system is.
- Reliable support. Sometimes problems occur and you need a quick way to contact brokers. Having their telephone number or opening a chat window allows completion of most bad situations, as long as the support is competent.
Step 2. Select Market
You want to trade in a market that has the highest liquidity - which locks you into a major currency pair.
The best currency pairs are:
- EUR / USD and GDP / USD. The Brexit puzzle controls the British and European currencies. Almost every day news comes that destabilizes the market.
- USD / JPY. The chaos in American politics resonates with this currency pair - even though Japan is undergoing a fairly quiet period.
However you can trade any other currency pair. The only problem is the small number of situations you can use - but this makes you less stressful and ultimately profitable for newcomers.
Step 3. Set Your Workplace
With most strategies, you only need a little time to read the news, enjoy a drink, or watch cartoons. However, scalping is a series of endless deals that demand your attention constantly.
If you want to be a successful scalper, you need to create an environment where you will not be bothered by other things. If you work from home, consider creating a separate room for work.
Step 4. Start Scalping
There are many theories behind scalping but if you want to make money right now the easiest way is a strategy called "calm river". The advantage of this strategy is not like full scalping but gives room for leeway and can be a good introduction.
strategy:
- Open long position when:
- Prices above 20 and 50 MA;
- 20 MA is higher than 50 MA.
- Both MAs have an upward / upward trend;
- There is little space between the two MAs;
- The price tries to leave an area between the two MAs with less than three candlesticks closed between the two MAs;
- The last candle opened between the two MAs is closed above 20 MA.
- Open a short position when:
- Prices below 20 and 50 MA;
- 20 MA is lower than 50 MA.
- Both MAs have a downward / downward trend;
- There is little space between the two MAs;
- The price tries to leave an area between the two MAs with less than three candlesticks closed between the two MAs;
- The last candle opened between the two MAs is closed below 20 MA.
Remember to try this strategy first on a training account. Sometimes it needs a little adjustment in different markets.
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