Scalping is an ultra-short-term trading strategy where traders make numerous trades in very short timeframes (usually seconds to minutes), earning small profits on each trade. The strategy relies on high-frequency trading, fast execution and strict risk control, achieving overall profitability through accumulating many small profits.
Fast execution: Requires fast trading platform and low-latency network connection
Small profits: Target profit per trade usually only a few pips
High frequency: May make dozens or even hundreds of trades per day
Strict stops: Stop loss per trade must be very small, usually smaller than target profit
Liquidity: Choose currency pairs with high liquidity and small spreads
Scalping strategy mainly applies to major forex currency pairs like EUR/USD, GBP/USD. Best trading sessions are European and US market overlap when liquidity is highest. The strategy requires focus and quick reactions, suitable for full-time traders and experienced short-term traders.
Short risk exposure time, minimal overnight risk; not affected by long-term market trends; can trade in any market environment; multiple trading opportunities daily; can quickly accumulate trading experience.
High trading costs, spreads and commissions are significant; requires high concentration, high mental pressure; high demands on trading platform and network; easily affected by emotions leading to wrong decisions; requires significant screen time.
When using scalping strategy, note: choose brokers with low spreads and fast execution; strictly control risk per trade; avoid trading during major news releases; stay calm, don't trade emotionally after consecutive losses; watch trading costs, ensure profits can cover costs; don't overtrade, maintain trading discipline.
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