scalping

I had scalping systems that backtested profitably but failed miserably when i tested them live (demo account) because I got horrible fills ordering from the DOM.
 
Quote from ksonsinc:

I understand you need to play it for the dollar but some time when the market is too slow what do you do - ?
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sit and watch porn videos or find some other decent setup.

you can trade stocks other than aapl you know.
 
Quote from TradingPilot:

I recently started testing a scalping strategy for futures on paper.
And from my short 2 month experience I would advise having your target be at least double your stop loss. I usually set my target really high and I manage the trade as its happening I rarely exit at my target unless its a big and fast move that runs right to it.

I would try not scalping the YM since its 5 dollar ticks and u need at least a tick to break even after commissions and fees.
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You seem to have missed a subtle important point in trading. Once you will understand (not read about) the what and why of scalping's weak points, you would understand trading for good.

BTW imagine this: you are with your baby in a beach. You allow him to play in the smallest of all waves, as it is safe.

When the bigger one shows up, where will you find your baby?
 
This is a great thread with great potential for sharing knowledge, where to start!

Scalping is a fantastic daytrading technique (I am a private equities fund manager) and have colleagues who are scalpers (and very successful ones too!).

They all have several qualities in common:

1) They have lightning quick reflexes

2) They are single

3) They like playing video games

4) They have nerves of steel.


As far as their actual techniques go, they are all different.

I believe that a general rule of thumb for successful daytrading it to keep your profit targets high (infinite if possible!) and your downside risk minimal.

This also means to make sure your holdings are quick. This is a double -edge sword though as Larry Williams has taught us that profits are a function of time, ie, the longer you hold, the greater the opportunity for returns.

Hope this helps,

Good luck in your trading education!

-HedgefundJim
 
Yield to broker is very high with scalping. If you pay 0.0085 cents, and you are trading in 5000 share lots (hopefully you are) for 5 cent gains, then you are looking at $85 a round trip, or 34% yield to broker for every SUCCESSFUL trade.

Factor in the fact that you WILL have losing trades and then multiply $85 times 100 or so round trips each and every day and you can see that your broker is the only one who is going to make money.

My trading style is to limit the yield to broker, but that's just me. If you feel you can overcome the headwinds you will face by scalping, by all means stand up on the gas pedal and go for it.
 
Agreed with Div Arb,

You're also going to need capital.

Lots of it.


A smartl scalper with tons of ammunition is dangerous,

Any scalper with minimal funds is dead in the water.


-Hedgefund Jim
 
Quote from nonlinear5:

If the number of the winning trades is 3 times the number of the losing trades, why not? Duh...you do the math. :)
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Wow you are dumb money just waiting to get slaughtered. What does your trading experience consist of, trading one share lots during the tech bubble?

Did you ever bother to consider slippage & commissions? Do you even know what those are?
 
I tried scalping and it wasn't for me. I'm more of an intraday swing trader now. I've been a lot more successful trading this way.
 
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