Forex scalping: What it is and how to do. At first before you learn Forex to its finest, you might think that trading Forex seems like a quick, effortless way to create money. As a consequence, you place a trade at high leverage and aim for pip then gain the money. It might seem simple until you lose in trading several times in a row and realize that you lose bigger than you win.
So, what is the point of all the explanation above? As you see that it is not practically easy to gain profit in the Forex market, you may need to find a way that can help you to trade better. At this point, you may find what is called scalping trading. What is scalping? Before you utilize this method, learn it further below.
What Is Forex Scalping?
In the Forex market, scalping is a term employed to indicate the “skimming” of little profits regularly by entering in and out of a position a few times each day. This trading activity engages trading currencies regarding on a selection of real-time analysis. Then, the aim of this activity is to gain profit by purchasing or selling currencies and seizing the position in short time.
#1 The Purpose to Scalp in Forex Trading
When it comes to scalping, it is necessary to remember that scalping is like day trading in which you are going to open a position to close it again throughout the recent trading session. At this point, you won’t carry a position until the next trading period or seize a position overnight. However, scalping will allow you to trade more than day trader does.
#2 Who Is Best to Scalp in Forex Trading
It is crucial for you to know that scalping is basically not really recommended in Forex trading. The reason is because this method is not for everyone. You need to have temperament if you want to do this. It can be a perfect method for you who spend your day trading. You need to sit in front of your PC for the whole session.
Even though you think that you are temperament enough to sit all day long facing your computer to learn Forex charts and market, you need to be someone who can trade very fast without analyzing every move. In scalping, there is like no time for you to think. You need to have ability to ‘pull the trigger’ if you want to be a quality scalper.
Things to Consider in Forex Scalping
If you like fast trading and don’t mind facing your charts for a few hours at a time, you might be a Forex scalper. Other signs of a Forex scalper are able to think fast. If you think that you can be a good Forex scalper and wants to try this, here are some points to consider once you decide to scalp in Forex market.
#1 Trade at the Right Time
The right time to Forex scalping is supposed to be throughout the busiest trading times. The most liquid times of Forex trading are usually during the overlap sessions. The overlap sessions are when two major Forex market open at the same time. Every day, it happens through 2:00 am to 4:00 am and through 8:00 am to 12:00 EST.
#2 Be Sure to Account for Spread
Since you are going to enter the Forex market frequently when scalping, spreads will become a major factor in overall profit. Make sure that your goals are minimally double your spread so that you are able to account when the market goes against you. Then, it is also a good idea to attempt on focusing to one pair first when you are scalping.