Scalping

Beginning traders in the OTC market are often interested in what is a scalping on Forex? The term refers to a trading strategy in which a trader seeks to profit from holding a position in a short period – from several minutes to several seconds. After the position has become profitable, the scalper closes the deal. To use the method, you need a large input account and the ability to quickly do mathematical calculations.

There are 2 types of scalping applications:

  • Pure – when a trader adheres only to this trading strategy;
  • Mixed (variational) – the scalper applies other strategies. In this case, the trader has already opened long-term positions, but when new opportunities appear, he opens short-term transactions.

The advantages of the trading strategy include the frequency of movements in the market – it is much easier to catch small price fluctuations than fluctuations in a wide range.

The disadvantages of the method include:

  • Great demands on platforms – any delay is fraught with losses, so the connection should be high-quality and ping fast;
  • A small profit from the transaction, from 5 to 10 points – therefore, it is necessary to perform a large number of operations during the day. Using leverage increases profit, but also increases risks.
  • Psychological moments – concentration and speed of reaction are required.

Thus, Forex scalping is best tried with a demo account to test your skills, reaction speed and ability to analyze the situation.