Is scalping blue-chip 'investments' viable?

[Turveyd]

The old buying quality, scalp for a profit or hold for ever ever until a profit comes back around.

Might feel safer, but another down move like a few weeks ago and you'll be waiting a long time to get your +$50 scalp profit and likely down $5K in the mean time.

As long as you don't hold over night or major news and therefore don't expose yourself to gaps then most of the time you'll get to profit, but ofcourse if your in a lossing position then your stuck over gaps and news, where it fails.

Ofcourse SL's quite often get hit, just for the trade to turn into a profit, which forces you to take another trade which loses to, then 2 losers rather than 1 profit.

There is no easy way to do this in short

 

[guowei58]

Hi guys,

So I'm new to trading/investing (I know these two are quite different things but here's my thought process).

Ultimately, I started a month ago wanting to invest in the stock market whilst everything has/is crashing. I'm managing to save $2000 a month to put into my trading account on eToro. Ive quickly realised how risky trading can be and so I'm trying to respect that by implementing a plan to be able to practice trading at a low risk.

Overall, I want to view this as more of an investment - it seems the risk is lower that way but I also want to learn how to day trade and perhaps maximize my profits a little more than just leaving it in an account.

So, I've learned that blue-chip stocks are the most reliable - and especially given the current situation with Covid I've tried to identify a list of companies that I believe will survive and bounce back after this recession. Microsoft, Apple, Coca-Cola etc.

My question is, is scalping without a stop loss a valid strategy on blue-chip stocks in the current climate? Ie, if I invest in McDonald's and I was wrong on my judgement of the screens is it okay to just leave it in the red on the assumption it will return in future? (PS, I'm only doing this as a buy)

Is this a viable, low-risk trading strategy that suits the market at this time? I've been doing it the last 2 weeks with a fairly good success but I'm unsure as to whether I could be earning more if I just leave it alone.

I apologise for what is most likely a newbie question. I'm trying to learn as much as I possibly can about investing at the moment.

Many thanks,

James

This strategy doesn't work. It may seem like it worked recently because the market is trending upward in the short-term, so you can get out profitably later if you're left holding the bag in a scalping trade. You have to have a stop loss in your system to prevent that one trade from causing a 50% drawdown.