Scalping strategy – system of Forex trader and broker

Scalping system – a strategy with the action and in the Trading

With the Scalping it concerns a very easy strategy which is applied apart from the Forex market also in other markets. Besides, a lot of Trades are entered in connection with very narrow Stop-Loss within short time. Besides, the trader pursues the aim possibly to earn many small profits which maximise themselves on account of the numerous Trades accordingly.

Is to be noted that not all brokers permit the use of the Scalping to strategy. Brokers have the problem with the Scalping that they cannot protect themselves fast enough and, therefore, it comes to losses, if the trader wins.

Which broker is recommended for the Scalping Trading?

Of course the choice of own Tradingstil also depends on choice of the broker. Somebody with pleasure in the long term tradet will make no difference it whether a position is opened as fast as possible, or lasts 2 seconds. With the Scalpen plays this factor is "Zeit" an important role. For a Scalper there is to have to wait nothing worse than for it to his position is opened or is confirmed.
Luckily there is for this Tradingstil also broker itself on it have specified Marketorders quickly to explain – so-called brokers ECN.

Advantages of the Scalping strategy:

•  Who controls Scalping, can run with it quick profits.
• no complicated technical or basic analysis necessarily.

Disadvantages of the Scalping strategy:

•  not with all brokers possibly
• Spreads destroy a part of the profits
• the Trading is very time consuming
• extensive market observation necessarily
• Risk / profit relation is often low

Use of the Scalping strategy

1.  Volatile currencies are suited for the Scalping best of all very much. Good examples for this are an UR/USD, EUR / JPY, GBP/USD and USD / JPY.
2. Use best of all the M1 or an even smaller Timeframe. Not to lose the overview, nevertheless, you should also keep an eye on the M5 and on M15 Timeframe.
3. The best period for the Scalping strategy is a session during the Europäischen/US/Asian.
4. Before he is put the first Trade you should study the market first for from 5 to 15 minutes.
5. Put the Stop-Loss at most for 10 Pips

With a profit of the from 1 to 1.5-fold of the Spreads the position is closed. Indeed, you cannot put the take profit as a rule so near in the Entry. Therefore, you must close the position with achievement of the profit brand by hand.

Meaning of Forex indicators with the Scalping

Forex indicators are already integrated in many commercial programmes and also allow with the Scalping efficient trade. Indeed, traders should exactly find out to begin with which indicators are suited for a Scalping strategy really. There is a huge number of Forex indicators which are very similar and which common application makes no sense. As a countermove some Forex indicators need other indicators with other data. Thus there are, for example, Momentum-indicators, prize indicators and volume indicators.

Where from do the Forex indicators come?

The development of Forex indicators began in the 1970s with the conversion of the stock exchange trading on computer. Certain oscillators like the MACD or the Stochastik can be calculated only with suitable software and explained. Other indicators like Fibonacci figures or gliding averages are older against it already around something. There comes that the Forex indicators became interesting only with opening of the foreign exchange market for private traders. For big investors the indicators played no special role. From 1980 there were with the Forex trade two essential developments. To one it was moved on computer programs and on the other hand it came for a softening of the exchange rates. With it Forex indicators for traders became more and more interesting and could be provided at the same time technically.

Kinds and effect from Forex indicators

Only in the MetaTrader 4 about 200 Forex indicators are integrated. Therefore, it is hardly possible to perform this all. Hence, in following some examples of different variations in the indicators which affect differently and are important for a Scalping strategy.

• Moving average: The gliding average counts not only with the Forex trade to the most important indicators and is used as the trend-following prize indicator. He contains the statement that the prize continuation will presumably take place nearby.
• Trading with RSI: The relative Strength index (RSI) also hears to the Forex indicators. This very helpful oscillator registers überkauften or überverkauften market state. Afterwards a trend change becomes extremely likely. Just in the Forex trade this is very often the case.
• Stochastik: With an Almost and Slow Stochastik can be also recognised überkaufte and überverkaufte market situations. Besides, a very easy construction %K and %D lines belongs to the advantages.
• MACD: This Forex indicator indicates gathering or diverging a gliding average. He is valid generally as the most important indicator for the Forex trade. A visualisation of the changing Momentums belongs to the special advantages.

In practice there are still numerous other Forex the indicators which can matter to the Scalping strategy. Moreover belongs, for example, the volume indicator ADL (Accumulation distribution Line) from Chaikin, the Momentumindikator RoC (rate of Change) or the trend indicator TRIX. Before you apply a Scalping strategy in practice, you should try out several indicators to ascertain with whom you manage best of all.

Examples like the Scalping strategy can affect

Open a Long position with EUR/USD. The Spread lies with 2 and the Stop-Loss with 10 Pips. At the end of 30 seconds the position reaches the aimed profit brand from 3 Pips. Close this now by hand to take the profit of 3 Pips.

They open a Short position with the currency pair for GBP/USD. The Spread amounts to 3 and the Stop-Loss lies with 10 Pips. In this case the aimed profit lies with 4.5 Pips. Accepted the position runs against you and is closed by the Stop-Loss, then you would have achieved a loss of 10 Pips.

Examples of an easy Scalping strategy

The following Scalping strategy are relatively easy and also can be applied from less experienced traders. The conversion develops and of course also here different points must be followed.

Break-out Scalping strategy

Break-out meant so much like "outbreak" translates. The market can break out in general of three areas. This happens either from a defined rank as well as a striking high or low-pressure area. The following pictures should make clear the respective outbreak scenario.

Outbreak from a rank

In the following the market situation bullische Flaggenforamtion is shown in the upward trend. Now a possible Scalping strategy would be to be opened with touch of the lower trend line Long Position. Nevertheless, it is clear that the course will leave this border sometime. As soon as this happens, a good Momentum is in view. A Scalping Trade would arise, for example if the course has left the border about at least 10 Pips.

Outbreak from a striking high or low-pressure area

The following picture shows how the last low-pressure area is underbid by the course what also leads to a strong Momentum. And a Momentum is for Scalper always one thing romped. In the topical picture it concerns 15 Minutenchart. The problem is present that it often comes to false outbreaks.

If one considers himself the same situation in 5 Minutenchart becomes clear that the course comes back again to the trend line.

It comes here to a so-called Pullback. With this Scalping strategy it makes sense to wait, until the last high or low-pressure area was outbid or underbid by the course. Afterwards wait for the Pullback and position themselves in the direction of the outbreak.

The Bollinger of tape & Stochstic strategy

The „Bollinger of tape & Stochstic strategy“ is also a Scalping very simply to be moved strategy. Positively is present that she delivers very good entrance signals.

Recommended settings:

• Timeframe: 5 minutes
• Take profit: 10 Pips
• Stop Loss: According to own wish

The following indicators are necessary:

• Of Bollinger tape (20,0,2)
• Stochastic (5,3,3)

If the candle closes beyond the Bollinger tape and is of the Stochastic above the 80th or below the 20th zone the entrance signal is generated.

• Short signal: Candle closes beyond the upper Bollinger of tape and Stochastic signal about the 80th brand.
• Long Signal: Candle closes beyond the lower Bollinger of tape and Stochastic signal under the 20th brand.