Scalping is risky ?
- Thread starter JimmyChoo
- Start date
Hi everyone, i am scalper operating on a 1-5 second chart. In order to be successful in scalping you need to act very very quickly, your decisions are not effected by your intuition but from a mechanical trading system, in other word, if you get a signal you jump in. Trading on seconds time frames, you do not need to do any technical analysis, you go long and short without any mercy, a typical trade last for less than 10 seconds. A trading day max 8 hours, you will be able to place up to 100 trades, my risk/reward is 1:1, if the trade does not hit my target within the next seconds, i close it at brake even or with a loss. If i should split up 100 trades, i would say that i probably lose 15, i win 65-70 and close the rest at brake even. I trade cryptocurrency on a ladder trading exchange, no fees (paramount), each tick on the ladder is 5 dollars, if you take profit at the next tick, you will gain 10% of your bet, if you win 50 trades, at the end of the day you make 5 times your bet(for each trade). Your system must be totally FIXED, take profit, stop losses, your entry size does not change for each trade session. If you are emotional, anxious and especially if you do not accept losses, stay away from scalping, it is all about probabilities over a certain number of trades during a session. If you are good, depending of the exchange you are trading on, you will be able to multiply over 50 times your starting capital. I do not consider my self good enough but in 2 and half months i multiplied 160 times my starting capital trading on Digitex future exchange. Scalping is not more risky that other trading activities, i would say it is more difficult because it requires extreme discipline(more than a strategy), money management and personal skills. Good luck to everyone
Thanks for the amazing details and insight.
"a typical trade last for less than 10 seconds. A trading day max 8 hours, you will be able to place up to 100 trades"
1- This ^^^ is all relate to crypto trading I am assuming and not Forex scalping or regular market stocks - correct?
2- What is a "ladder trading exchange"? some crypto exchange or broke? Name please.
3- You said, "No fees" - how? exchanges I deal with charge much more than regular stock market trading. I read further and you said Digitex...I think I read about them or someone similar. Are they the kind that don't deal with fiat at all? and the only send your crypto back only to a different wallet address so that you don't send crypto between exchanges?
4- "if you do not accept losses, stay away from scalping" - hmmm I like it the other way if possible lol but good point.
Thanks
I think you mean:
"If you don't take risks, you risk not living."
OR
"What you risk reveals what you value."
OR
"If you don't take risks, you will always work for someone who will."
Hi, that is correct, i do trade on Digitex future exchange which currently offers only BTC/USD, they are planning to introduce as well oil, gold and other assets in the near future.
Ladder trading is a different way of trading, by definition:
A Ladder option is a type of binary option trade in which the trader is given a range of price levels which are lined at equal intervals like a ladder, for the trade to finish higher or lower than, at the end of the trading day.
Picture below shows ladder of Digitex. Exactly, no fiat on Digitex, your portfolio value is in DGTX token, which directly you can swap to BTC or sell dgtx for BTC, and than exchange in euro or dollar.
I do not consider a loss as a loss..., they are just part of a bigger picture, if you do not loose you cannot win, it is simply your investment into the trading business, like having a rent to pay or other company costs. As long as you have a proper management and risk reward is is appropriate, those losses will not effect your gains. Regards.
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its a very nice detail with more information, got some fine lines with exact knowledge , thanks again for the nice post.
Thanks for your feedback Ahmed, you are welcome.
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Yes, scalping is no doubt risky. If you have right strategy along with calculated risk and mentally discipline, tested over time, you'd make it. But there's rising concern: broker's slippage, widening spreads, that's attacking the scalping entry/exit. I'd prefer doing it with broker that have low avg spread consistently with fast order execution. Been small to big, but I recently started with fxview, found their conditions quite good for scalpers. If your broker is good with these, it shall be all well-packed