They keep on learning about the most advanced trading techniques and eventually lose money from most of the trades. To become a professional scalper, you don’t have to learn complex trading techniques. By following some simple rules you can trade in the lower time frame with a high level of precision.
In this article, we are going to share some powerful tips which will help you to scalp the market like a professional trader. Follow the tips mentioned in this article and you will no longer struggle with a lower time frame trading strategy.
Selecting the asset
Being a scalper, you should be extremely careful with the asset selection process. If you expect to make a big profit by scalping the cross pairs, you are making a big mistake. The spreads are very high in the cross pairs and the price movements are very choppy. Even if you manage to find one good trade, you have to cover up a huge spread just to make a small profit. That’s why most of the elite scalpers prefer to trade the major currency pairs only. The movements of the price in major currency pairs are much more trending and it offers stable profit-making opportunities to the retail traders.
Finding the trend
You need to stick to the major trend to find reliable trade signals in the lower time frame. The elite scalpers at Saxo always trade the market with the major trend as they know taking the trades against the existing trend increases the risk factors significantly. To find the direction of the trend, you should not be relying on the lower time frame. Move back to the daily or the 4-hour chart and use the trend line to find the direction of the trend. Once you have identified the trend direction, you may switch back to the lower time frame to execute your trades.
Stop using EAs
The rookies often use EAs to find reliable trade signals in the market. Trying to scalp the market with the help of EAs is a very big mistake. You might even blow up your trading account. You should learn the manual scalping method in the demo trading account. If necessary, use one or two indicators to find the overall direction of the market trend. Once you become good at analyzing the major trend in the market, you will no longer use the EAs. Always remember, automated trading bots are nothing but a waste of time and money.
Learn price action trading strategy
A price action trading system is one of the best ways to find reliable trade signals in the market. The professional scalpers always rely on candlestick patterns to trade the critical support and resistance level. Being a user of Japanese candlestick patterns, you should be able to find reliable trade signals with a high level of accuracy. This means, you can trade the market with a very tight stop loss and you won’t have to worry about losing trades. Always follow the safety protocol in the trading profession and you will do well in the trading business.
Trade with a very low risk
Scalping doesn’t mean you will trade the market with high risk. No matter how good you are scalping the maximum risk should not exceed 2% of your account balance. As long as you trade the market with a very low-risk exposure, you should feel safe with your trading approach. You will more confident and thus you can earn more money. At times, you may have to lose a series of trades but still, you should not increase the risk exposure to recover the losses. Stick to your trading system and keep scalping with a conservative mindset.